US producer prices pick up in February

US producer prices picked up steam in February, boosted by a surge in gasoline prices, but overall wholesale inflation remained modest, according to government data released Thursday.

The Labor Department's producer price index for finished goods rose 0.7 percent in February, after a 0.2 percent rise in January and a 0.3 percent drop in December.

The strongest monthly PPI increase since September was led by energy prices, which jumped 3.0 percent, with most of the gain from a 7.2 percent surge in gasoline prices.

Food prices dropped 0.5 percent.

Excluding food and energy prices, which can be volatile month-over-month, core PPI rose 0.2 percent, the same as in January.

On an annual basis, producer prices rose 1.7 percent, a pickup from the pace of the past three months.

The data underscored nevertheless the continued weak inflationary pressures in the sluggish economy, which eked out growth of 0.1 percent in the fourth quarter of 2012 despite massive stimulus from the Federal Reserve.

"The underlying trend remains positive but tame," said Jim O'Sullivan of High Frequency Economics, adding that gasoline prices probably would fall in March.