Food Prices See Sharpest Rise in 36 years

WASHINGTON — Wholesale prices surged last month at their fastest pace in just over 1-1/2 years due to higher energy costs and the steepest rise in food prices in 36 years.

Excluding those volatile categories, inflation was tame.

The Labor Department said Wednesday that the Producer Price Index rose a seasonally adjusted 1.6 percent in February — double the 0.8 percent rise in the previous month. Outside of food and energy costs, the core index ticked up 0.2 percent, less than January's 0.5 percent rise.

The report comes one day after the Federal Reserve said it expected the upward inflation pressure from energy and other commodities to prove transitory, but that it would keep a close eye on inflation and inflation expectations.

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No need for alarm folks. The Federal Reserve assures us that inflation is not a problem.