US prices pushed higher by food

Food prices have surged, with cauliflower up by 145%

Wholesale prices in the US spiked 1% in March, mostly reflecting more expensive food and petrol prices.

The rise in price inflation of goods before they reach store shelves came after a 1.3% jump in February, the US Labour Department said.

The pick-up in the Producer Price Index (PPI) was steeper than expected.

But without volatile energy and food prices, all other prices were flat, suggesting inflation has so far not spread to the wider economy.

The report noted food prices advanced 1.4% in March, with cauliflower prices up 145% and sweetcorn up 21.7%, on the previous month, while petrol prices swelled 8.7%.

'Not pleasant'

In the 12 months to March, wholesale prices rose 3.2%, the fastest pace since August 2006. The core PPI, in contrast, was up just 1.7% from a year ago.

"Food and energy costs are surging, but if you don't have to eat and drive, life is not that bad," said Joel Naroff, president of Naroff Economic Advisors.

"This was a pretty good report, if you are a central banker. If you live in the real world, it was not pleasant news."

When it meets in May, the Federal Reserve is widely expected to hold base interest rates at 5.25% for the seventh time in a row.

But the minutes from its last meeting raised the possibility of another hike to combat inflation risks.