---

                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: FRIDAY, January 15, 1993                   TAG: 9301150156
SECTION: BUSINESS                    PAGE: A-5   EDITION: METRO  
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

---

INFLATION JUST NOT A PROBLEM

Wholesale prices edged up just 1.6 percent in 1992, one of the best showings in the past 20 years, the government said Thursday. Slow economic growth curbed price markups.

"Of all of the problems we have got today, inflation is not one of them," said Michael K. Evans, head of a Washington economic forecasting service.

Ron Schreibman, vice president of the National Association of Wholesaler-Distributors, agreed. "I see several things to worry about," he said, "but inflation certainly is not one of them."

The Labor Department's Producer Price Index rose 0.2 percent in December, which helped limit the annual gain.

The report attributed much of the annual increase to a 1.5 percent advance in food costs, including a 67.4 percent surge for fresh and dry vegetables.

It was the first yearly increase in prices of finished goods at the wholesale level since they jumped 5.7 percent in 1990. Prices actually fell 0.1 percent in 1991, only the second decline since they dropped 0.3 percent in 1963. They also fell 2.3 percent in 1986.

Energy prices continued to fall, edging down 0.1 percent in 1992 after a 10 percent drop a year earlier as the world petroleum situation returned to normal after the Persian Gulf War.

Excluding the volatile food and energy components, wholesale prices rose just 1.9 percent, well below the 3.1 percent jump recorded in 1991.

The various changes left the Producer Price Index, unadjusted for seasonal variations, at 123.8 in December, compared with 121.9 in the same month of 1991. That means a market basket of goods that cost $121.90 a year ago would have cost $123.80 last month.

---