US wholesale prices fell 1.9 percent in December amid a further plunge in energy costs and weak economic conditions that have put downward pressure on prices, official data showed Thursday.
The 1.9 percent drop in the Labor Department’s producer price index (PPI) in the last month of 2008 was in line with analysts’ expectations and followed a drop of 2.2 percent in November and a 2.8 percent fall in October.
The report showed a fifth straight month of falling wholesale prices, highlighting fears of a deep economic slump that some analysts say could lead to a crippling deflationary cycle.
For the whole of 2008, producer prices fell 0.9 percent compared with a 6.2-percent advance the year earlier.
“The 2008 downturn is mostly attributable to energy prices, which dropped 20.3 percent after rising 17.8 percent a year earlier,” the Labor Department said in a statement.
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