Producer Prices Drop 0.3% in November

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roducer prices in the United States declined 0.3% in November, the first decrease in six months, the Labor Department reported Friday.

The drop in the producer price index, which measures inflation pressures before they reach retail store shelves, followed a 0.8% rise the month before. Excluding volatile food and energy prices, the "core" rate dropped 0.1% after rising 0.5%.

A falling PPI could indicate weak demand for goods, which would mean fewer shipments for trucking companies.

Despite the economy's strengthening in the second half of the year, companies have not been able to raise prices as they compete with imported goods and manufacturers face excess production capacity, Bloomberg reported.

Passenger car prices fell 0.8%, the biggest decline since April, while the costs of computers fell 1.2% and food prices fell 0.3%, Labor said.

nergy prices fell 1.2% last month after falling 0.1% in October. Gasoline prices dropped 4.8%, the biggest decline since May.

Labor's report said that producer prices were 3.4% higher in November than a year ago, matching the year-over-year increase in October. Core prices rose 0.5% in the last year, also the same as in October.

In the first eleven months of the year, wholesale prices rose at a 4.1% annual rate compared with a 1.6% increase at the same time last year.

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