A big surge in energy costs pushed US producer prices up a steep 0.7 per cent last month, but underlying price pressures were subdued, a government report showed today.
The US Labor Department said the jump in its producer price index - a measure of prices received by farms, factories and refineries - was the biggest since a matching energy-led gain in November.
But outside of volatile food and energy costs, producer prices advanced a mild 0.1 per cent for the second straight month, which could help allay inflation concerns stoked by lofty oil prices.
Although the increase in overall producer prices was slightly higher than the 0.6 per cent expected on Wall Street, the rise in so-called core prices came in slightly below expectations.
Energy prices shot up 3.3 per cent in March, the biggest jump since October, with gasoline prices up 5.3 per cent, home heating oil up 15.7 per cent and residential natural gas up 2.3 per cent.
Over the past 12 months, producer prices have risen a sharp 4.9 per cent - the biggest year-on-year gain since November - as oil prices have pushed higher. Oil prices hit a record high above $58 a barrel early this month, but quickly retreated.
Some analysts expect some energy price relief when the April producer price report is released. Prices for cars, light trucks and SUVs slipped 0.2 per cent last month, the second consecutive monthly drop; the cost for computers plunged 3.4 per cent.