U.S. producer prices rose more than expected in January, recording their largest gain in four years amid increases in the cost of energy products and some services, but a strong dollar continued to keep underlying inflation tame.
The Labor Department said on Tuesday its producer price index for final demand jumped 0.6 percent last month. That was the largest increase since September 2012 and followed a 0.2 percent rise in December.
Despite the surge, the PPI only increased 1.6 percent in the 12 months through January. That followed a similar gain in the 12 months through December.
Economists polled by Reuters had forecast the PPI rising 0.3 percent last month and the year-on-year increase moderating to 1.5 percent. The rise in producer prices comes as manufacturers are reporting paying more for raw materials.
The gains largely reflect increases in the prices of commodities such as crude oil, which are being boosted by a steadily growing global economy. Oil prices have risen above $50 per barrel.