January 15, 2009

Producer prices dropped in December

The Producer Price Index for finished goods in the United States fell 1.9 percent in December, pushed by falling energy prices, the government said Thursday.

Prices paid by producers rose 0.2 percent with food and energy prices taken out of the picture. Food prices during the month fell 1.5 percent, while energy costs dropped 9.3 percent, the Department of Labor Statistics said.

In November, energy costs dropped 11.2 percent.

The index for durable good materials fell 7.2 percent, including a 16.6 percent decline in prices for cold rolled steel sheet. Over the past 12 months, prices for materials dropped 5.5 percent, after gaining 1.7 percent in 2007, the report said.

In finished goods, prices producers paid for vehicles recovered slightly in December, climbing 1.2 percent for passenger passenger car prices and 0.8 for light trucks.

The 1.9 percent decline was in line with expectations, which called for 2 percent decline. For 2008, the Producer Price Index fell 1.2 percent, the report said.