Source: MarketWatch

U.S. producer prices fell 0.4% in September — the second consecutive monthly decline — as energy dropped but food rose, the Labor Department reported Wednesday.

Excluding food and energy, core producer prices rose 0.4% last month. Analysts polled by MarketWatch had been looking for a decrease of 0.6% in overall PPI as well as a 0.2% increase in the core rate.

Against a backdrop of deepening economic woes, the government’s report tracking inflationary pressures at the wholesale level actually provides some breathing room on the inflation front.

Further back in the production pipeline, overall prices declined 1.2% for intermediate goods and plunged 7.9% for crude goods. Prices changes for raw materials don’t translate directly into retail prices.

Joel Naroff, chief economist at Naroff Economic Advisors Inc., said it’s likely that price pressures will “start easing going forward as the full extent of the slowdown hits home.”

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