Companies paid more for wholesale goods, though inflation pressures muted
Finance Wednesday, August 17th, 2011
From: WashingtonPost.com
WASHINGTON — A key measure of wholesale inflation rose in July by the most in six months.
The measure, called core wholesale inflation, excludes volatile food and energy prices. It surged 0.4 percent last month.
But most economists say they aren’t concerned about the increase. One reason is that it was driven largely by costlier tobacco products and pickup trucks, which economists say are probably one-time events.
Raw material prices also fell in July. Those figures should lead to lower wholesale prices in coming months.
And the costs of components are rising more slowly than the costs of the finished goods calculated in the inflation measure.
The Federal Reserve and private economists tend to focus on core inflation. It’s seen as a better predictor of price changes than overall inflation is.
To read more, visit: http://www.washingtonpost.com/business/economy/companies-paid-02-pct-more-for-raw-materials-and-factory-goods-in-july-food-prices-rise/2011/08/17/gIQA3ut6KJ_story.html
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