U.S. producer prices rose in November on advances in foods and transportation services, while a measure of underlying costs accelerated, offering some potential signs of inflation pressures bubbling up in the economy.

The producer-price index advanced 0.1 percent from October, cooling from a rise that was the fastest in six years, Labor Department data showed Tuesday. The annual gain slowed to 2.5 percent from 2.9 percent. The Bloomberg survey median estimates called for no change from the prior month and a 2.5 percent annual increase.

Key Insights

• The figures, which measure wholesale and other selling costs at businesses, suggest prices are starting to stabilize. That may ease concern — after other recent measures — that inflation was drifting below the Federal Reserve’s goal just when policy makers thought it was steadying around their 2 percent target. 
• Service prices in the PPI were boosted by higher margins at wholesalers and retailers, though much of it came from fuels and lubricants retailing with a 25.9 percent increase, the most since 2010. Indexes also rose for health and beauty retailers, wireless-phone services and airline passenger services. 
• While the plunge in global oil costs is keeping headline inflation muted, the tariff war with China means producers may face higher materials prices and supply-chain disruptions. 
• Excluding food and energy, the monthly and annual gains in the core PPI both exceeded estimates, with the annual increase picking up from the prior month. Producer costs excluding food, energy, and trade services — a measure preferred by some economists because it strips out additional volatile components — rose 2.8 percent from a year earlier for a second month.

Recent oil price declines weighed on headline producer prices in November. Yet, the underlying fundamentals point to firming inflationary pressures in the service sector, according to Tim Mahedy and Carl Riccadonna of Bloomberg Economics. This supports the FOMC’s view that the gradual march toward policy normalization is appropriate, even as economic activity moderates next year.

Energy prices fell 5 percent from the prior month, the biggest decline since September 2015, while food costs jumped 1.3 percent, the most since March. Analyst estimates for the monthly PPI change ranged from a 0.3 percent drop to a 0.1 percent increase. 

While the consumer price index — due Wednesday — is considered a more important indicator of inflation, data on producer prices help provide insights into the direction of costs that businesses are facing.