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U.S. wholesale inflation falls for first time in 7 months

Staff Writer |
U.S. inflation at the wholesale level fell in March for the first time in seven months, owing to lower costs for services such as investment advice as well as cheaper fuel for cars and homes.

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The producer price index slipped 0.1% last month to mark the first decline since August, the government said Thursday.

Still, some inflationary pressure is building for the first time in several years and prices could rise even higher. Over the past 12 months wholesale costs have risen 2.3%, the biggest increase in five years.

So-called core producer prices rose 0.1% in March and posted a 10th consecutive gain. The core price measure strips out fuel, food and retail trade margins - they can gyrate month to month - and gets more attention from the Fed and Wall Street.

The core rate has risen 1.7% in the past 12 months. That’s almost double compared to a year earlier, but down slightly from a recent two-year high of 1.8%.

The cost of partly finished goods, meanwhile, rose 0.1% in March while prices for raw materials fell 4.2%.