The Producer Price Index for finished goods increased 1.6% in February 2011. The PPI measures prices obtained for U.S. goods. Intermediate goods prices increased 2.0% and crude or raw materials prices went up 3.4%. PPI is often called wholesale inflation by the press.
The reason finished goods prices increased was energy, up 3.3% in one month and food soared 3.9% in one month. The increase in gas caused 45% of the energy finished goods increase. The Finished foods index monthly increased was 70% vegetables, which soared 48.7% in a month. It's unclear if the freeze and crop destruction in Mexico has something to do with this.
For the year, finish goods PPI increased 5.6%, the largest increase since March 2010.
Core PPI or finished goods minus food and energy, increased 0.2% for February 2011. There was a 0.6% price increase for passenger autos in core PPI and this was 20% of the total core PPI monthly increase.