US wholesale prices fell 0.2 percent in December

US wholesale prices fell 0.2 percent in December
FILE- In this Sept. 10, 2018, file photo corn plants shoot out of a forage harvester as farmer Jim Minott works to get some of his 50 acres harvested before impending rain in Brunswick, Maine. Minott will feed the silage to his cows. On Tuesday, Jan. 15, 2019, the Labor Department reports on U.S. producer price inflation in December. (AP Photo/Robert F. Bukaty, File)

WASHINGTON (AP) — U.S. wholesale prices fell last month, dragged down by a steep drop in gas costs, suggesting that inflation will remain tame in the coming months.

The Labor Department said that the producer price index — which tracks cost changes before they reach the consumer — fell 0.2 percent in December from the previous month. The drop follows a small 0.1 percent increase in November.

Wholesale prices rose 2.5 percent in December from a year earlier, the same 12-month increase as in November. Excluding the volatile food and energy categories, core prices increased 2.7 percent.

Federal Reserve Chairman Jerome Powell has said that recent muted inflation data have helped the Fed to be “patient” when it comes to raising short-term interest rates.