Producer Prices Drop Unexpectedly
February's Producer Price Index Drops 0.6%
March 17, 2010 - Falling 0.6% in February, the Producer Price Index surprised many economists this morning by declining more steeply than originally thought. The Labor Department stated that last month's drop was the largest fall seen since July.
Today's PPI report followed a recent Federal Reserve meeting which reiterated previous sentiments to hold interest rates low. Fed Chairman, Ben Bernanke, announced just last month that he was planning on maintaining rates at low levels so that the market could continue to heal. While it seems that the PPI is supporting the Fed's decision to keep rates down, producer prices have increased a total of 4.4% since February 2009.