Higher energy costs boosted producer prices 0.9 percent in May, but excluding volatile food and energy costs, prices paid at the factory gate were up a more moderate 0.2 percent, the Labour Department reported on Thursday.
Separate data out on Thursday showed no change in the number of workers signing up for first-time jobless benefits last week, underscoring stability in the labour market. Economists polled ahead of the data were expecting producer prices - the prices paid by manufacturers and wholesalers - to rise 0.6 percent and by 0.2 percent when energy and food were stripped out.
Overall producer prices, which are a measure of prices before they reach the consumer, rose 4.1 percent from a year ago, the biggest year-over-year increase since June 2006. However, core producer prices were up just 1.6 percent from a year ago, and that moderate gain will likely add some relief to Federal Reserve policy-makers as they balance the risks of inflation against economic growth.
Energy prices were up 4.1 percent in May, the biggest monthly rise in six months. That monthly gain was partly due to a 10.2 percent rise in gasoline prices, also the biggest monthly increase since last November.
Meanwhile, the number of workers signing up for first-time unemployment benefits was unchanged last week at a seasonally adjusted 311,000, the Labour Department reported on Thursday.
RATE OF HOME FORECLOSURES HITS RECORD: The rate of US home loans entering the foreclosure process rose to a record level in the first quarter of 2007, while late payments fell from the previous quarter, an industry trade group said on Thursday.
The Mortgage Bankers Association said the rate of loans entering the foreclosure process was 0.58 percent on a seasonally adjusted basis, or more than one out of 200 loans and 4 basis points higher than the previous quarter. The rate rose 17 basis points from a year ago.
The delinquency rate for mortgage loans on one- to four-unit residential properties stood at 4.84 percent of all loans outstanding in the first quarter on a seasonally adjusted basis, down 11 basis points from the fourth quarter and up 43 basis points from a year ago, according to the MBA's National Delinquency Survey.
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