Como se combate o populismo? "Com eleições", responde Fukuyama

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8:30am 03/22/05 U.S. FEB. PPI UP 0.4%, CORE UP 0.1%

ECONOMIC REPORT: U.S. Feb. producer prices up 0.4%; Feb. core PPI rises 0.1% as expected
By Rex Nutting, MarketWatch
Last Update: 8:31 AM ET March 22, 2005

WASHINGTON (MarketWatch) - A surge in energy prices pushed the U.S. producer price index for finished goods up 0.4 percent in February, the Labor Department reported Tuesday.

Excluding big increases in food and energy prices, the core PPI increased a more moderate 0.1 percent, the agency said.

The headline figure was slightly larger than expected. Economists were forecasting, on average, a 0.3 percent gain in the PPI. The core PPI came in as expected, according to the survey conducted by MarketWatch.

The PPI had increased 0.3 percent in January, with the core PPI shooting up 0.8 percent, the largest increase in six years.

As a result, prices of goods ready for retail sales have climbed 4.7 percent in the past 12 months. The core PPI is up 2.8 percent in the past year, the fastest gain in more than nine years.

In February, inflationary pressures were also mounting further back in the production pipeline. Prices of intermediate goods destined for further processing increased 0.7 percent, while the core intermediate PPI climbed 0.5 percent.

However, some relief may be coming. Prices of crude materials fell 1.6 percent in February. Prices of basic industrial materials fell 3 percent, including a 12 percent drop in iron and steel scrap prices. Crude foodstuffs prices dropped 3.2 percent. Meanwhile, crude energy prices increased just 0.2 percent, despite the 3.3 percent rise in crude petroleum prices.

The inflation figures are likely to have little impact on Federal Reserve policymakers meeting in Washington.

Analysts are nearly unanimous in their belief that the Federal Open Market Committee will raise its federal funds target rate by a quarter percentage point to 2.75 percent, the seventh consecutive quarter-point hike. The announcement is expected at about 2:15 p.m. Eastern.

Fed officials have said inflation and inflationary expectations remain well contained. Despite large increases in energy and other commodity prices in response to heavy global demand, U.S. consumer prices have not accelerated out of control.

Intense competition, especially in labor markets, has kept inflation moderate.

In February, energy prices increased 1.4 percent, including a 5.2 percent rise in gasoline. Consumer food prices increased 0.8 percent, including the largest rise in egg prices in four years.

Finished capital equipment prices fell 0.2 percent. Prices of consumer durables fell 0.5 percent. Light motor truck prices.fell 2.8 percent, the largest drop in two years. Passenger car prices dipped 0.9 percent.