US wholesale prices fell 0.2 percent in December

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.