BUSINESS

US producer prices rise 0.2 per cent in October; rising auto costs offset falling gas prices

11/18/2014 08:38 EST | Updated 01/18/2015 05:59 EST
WASHINGTON - Inflation picked up in October due to higher prices that U.S. companies received for new model cars, beef, pork, pharmaceuticals and electric power.

The Labor Department says the producer price index increased 0.2 per cent in October from the previous month. The index measures the cost of goods and services before they reach the consumer.

Prices for many products climbed despite wholesale gas costs plummeting 5.8 per cent last month. Automakers contributed to inflation by introducing 2015 car models, while beef prices climbed 6 per cent and pork prices surged 8.1 per cent.

Excluding the volatile categories of food and energy, prices rose 0.4 per cent in October.

Still, overall inflation has been historically mild. Over the past 12 months, producer prices have risen 1.5 per cent, well below the Federal Reserve's target of 2 per cent.