Rising prices for food, cars and electricity fanned inflation at U.S. factories and farms in January, while higher gasoline prices in early February caused consumers to be less upbeat, according to data on Friday. The inflation data helped financial markets, which are already counting on an increase in interest rates when the Federal Reserve meets in March, cement their expectations for another rate rise after that. The Labor Department said U.S. producer prices rose by 0.3 percent in January while prices excluding food and energy climbed 0.4 percent. The latter was twice expectations and the fastest wholesale inflation since January 2005. "The most disconcerting part of the PPI report today was the rate of final core producer price pressures in January," said Jason Schenker, an economist at Wachovia Corp in Charlotte. "The implication is that core inflation may be rising. If we see similar moves in the core CPI number, we are even more likely to see Fed hikes in March and May," he said. --More 23 23 Local Time 20 23 GMT
