Wholesale prices edge up

Inflation adjuster

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NEW YORK (CNNMoney.com) -- Wholesale prices paid by businesses rose slightly in October following a larger increase the month before, according to a government report released Wednesday.

The Producer Price Index showed a 0.1 percent increase in October, compared to the 1.1 percent increase in September. Economists had forecast a 0.2 percent rise in the PPI last month.

Energy prices fell 0.8 percent, after a gaining 4.1 percent in the previous month, while food prices rose 1.0 percent in October.

The more closely watched core PPI, which strips out volatile food and energy prices, was unchanged after a slight 0.1 percent gain in September.

The Federal Reserve, in its watch for inflation, generally is comfortable with core measures of inflation at 1 percent to 2 percent over a 12-month period.

The PPI is one of the more volatile inflation readings. The previous month's reading is not revised using more complete measures of prices, and it only measures the price of goods, not services.

But the PPI gets a fair amount of attention from investors and economists in months when it is released ahead of the more closely-followed Consumer Price Index, which is the government's key inflation reading of inflation at the retail level.

The CPI report is set to be released Thursday, with the overall CPI forecast to be up 0.2 percent, after a 0.3 percent rise in September.

The core CPI is expected to increase 0.2 percent, the same amount as in September.