Jump in Energy Costs Pushes Wholesale Prices Up 0.5% : Economy: The February report may ease pressure on Fed to push up interest rates next week.

A jump in weather-related energy prices propelled inflation at the wholesale level in February to the largest increase in almost a year, the Commerce Department said Tuesday.

Producer prices rose 0.5%, the biggest jump in 10 months, although with the volatile food and energy sectors excluded the increase was a modest 0.1%. Both increases were nearly in line with Wall Street estimates.

The rise in February’s producer price index, which measures the prices wholesalers pay for goods ready to sell to stores, compares to a 0.2% increase the prior month--a 0.4% increase without the food and energy components.

The department said energy costs increased 2.8% last month, while gasoline prices rose 6.3% and home heating oil climbed 23.5%.

Food prices actually declined 0.4% in February as prices for beef, fish and vegetables dropped.

The report should ease pressure on the Federal Reserve Board to push interest rates up at a meeting next Tuesday, said Michael Evans, head of Evans Economics Inc. of Boca Raton, Fla.

The Fed nudged short-term rates up a quarter of a percentage point to 3.25% in February, the first increase in five years.

In other economic news, the broadest measure of the U.S. trade deficit jumped by $42.84 billion in 1993 to the highest level in five years, including a $31.54-billion imbalance in the final three months, the Commerce Department said.

The report said the 1993 shortfall in the U.S. current account totaled $109.24 billion, the largest gap since a $127.2-billion deficit in 1988. An increase in the merchandise trade deficit accounted for most of the rise.

Meanwhile, the Federal Reserve Board reported that industrial production rose a modest 0.4% in February, slowed by the winter weather and Northridge earthquake. It was the ninth straight advance.

A surge in automobile production accounted for most of the rise, offsetting declining factory production almost everywhere else.

Producer Price Index

Finished goods: seasonally adjusted change from prior month:

+0.5%

Source: Labor Department