Food drives prices higher in April, but inflation remains under control

April wasn't the best month for producer prices, but overall, inflation remains tame. Producer prices rose 0.3 percent in April, the U.S. Labor Department announced Thursday, as food costs increases offset other wholesale price declines.

Meanwhile, the core rate, which excludes the often-volatile food and energy component, rose just 0.1 percent. Economist surveyed by Bloomberg News had expected both the PPI and core rates to increase 0.1 percent in April. Producer prices fell 1.2 percent in March, and rose 0.1 percent in February.

However, even with the April wholesale price rise, the price pattern over the past year still suggests the greater risk to the slumping U.S. economy is deflation, not inflation. During the past 12 months, the producer price index has fallen 3.7 percent, with the core rate rising 3.4 percent.