Wholesale prices, helped by further declines in gasoline and other energy products, fell in March for a fourth consecutive month, the first time that has occurred in five years, the government said Thursday.
The Labor Department said the 0.3 percent drop in its Producer Price Index followed declines of 0.6 percent in both February and December and a 0.1 percent fall in January.In another report Thursday, the government said retail sales slipped 0.8 percent in March, their third loss in four months. The Commerce Department said sales totaled a seasonally adjusted $149.6 billion, down from $150.8 billion a month earlier.
The Bush administration hopes the good news on inflation will prod the Federal Reserve to go further in its campaign to fight the recession by lowering interest rates.
However, private economists expressed doubts, noting that a sharp policy split may make it impossible for Federal Reserve Chairman Alan Greenspan to convince his collegues to cut rates more.
Fed opponents of easing moves further argue that the central bank has already done enough to guarantee the end of a recession and that any additional easing runs the risk of making inflation worse next year.