Price Drop in February Steeper Than Expected

Wholesale prices took their biggest slide in seven months in February, largely due to a drop in energy costs, the Department of Labor said Wednesday.

Even a jump in the cost of food could not stem the 0.6 percent reduction in wholesale inflation, which was much steeper than economists expected.

The AP said the deep recession and weak recovery have kept inflation in check and prompted the Federal Reserve to hold interest rates low with the aim of fostering economic growth.

Overall, wholesale prices have risen 4.4 percent during the last 12 months, but core inflation -- which does not take into account food and energy -- is up only 1 percent.