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Tuesday, March 21, 2006

Further evidence that the Fed may be done tightening:

WASHINGTON (AFX) -- U.S. wholesale prices plunged 1.4% in February, the biggest decline in nearly three years, the Labor Department reported TuesdayEnergy prices fell 4.7%, also the biggest drop since April 2003. Food prices fell 2.7%, the most in four yearsEconomists expected the PPI to fall about 0.3%The core producer price index - which excludes food and energy prices - rose 0.3%, stronger than the 0.1% gain expected by Wall Street economists surveyed by MarketWatch. In the past year, the PPI has risen 3.7%, compared with 5.7% last month.

The Feds reaction?

The report is not likely to have much impact on the Federal Reserve's deliberations next Tuesday. Most analysts expect the Federal Open Market Committee to raise overnight lending rates for the 15th straight meeting to stay ahead of inflationary pressures. Last week, the Labor Department reported that consumer prices were well behaved in February...

Read the whole thing.

Posted by Trade Monkey :: 9:44 AM :: 0 comments Perma-Link

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