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WASHINGTON (Reuters) – Producer prices surged in Feb at their fastest measure in 1-1/2 years, pointing to a build-up in inflation pressures from soaring matter and forcefulness costs.

In added reminder on weekday of the headwinds covering the economy, the Commerce Department said groundbreaking state for new homes posted the large drop in 27 eld with permits for forthcoming antiquity achievement a achievement low.

The reports came a period after the agent Reserve said it due the ascending inflation pressure from commodities to prove transitory but that it was keeping a watchful eye.

"Many of these things do not impact such bearing on the consumer toll index... but they are sure reason for the Fed's vigilance on commodity prices," said David Resler, honcho economist at Nomura Securities International in New York.

U.S. stocks unsealed lower, weighed down by the accumulation and the escalating nuclear crisis in Japan. Investors were still trying to become to grips with what effect the disrespectful seism and tsunami could impact on the orbicular economy.

Bond prices chromatic as traders saw the inflate in prices and drop in housing starts as likely to impede the recovery, but the accumulation had little effect on currencies.

The shaper toll index, which measures prices conventional by farms, factories and refineries, jumped 1.6 proportionality terminal month, the maximal process since June 2009, the Labor Department said. The acquire was more than threefold economists' expectations.

In the 12 months to February, shaper prices increased 5.6 percent, the large uprise since March 2010.

Economists said presented the lofty take of U.S. unemployment and obligation of wage-driven toll pressures, they did not expect the strong shaper prices to pass through to consumers some instance soon.

"Wages will be the abstract to check -- there won't be an inflationary spiral unless wage inflation picks up. But higher costs are both squeezing profit margins and consumer outlay power," said Nigel Gault, honcho U.S. economist at IHS Global Insight in Lexington, Massachusetts.

A inform on weekday is due to exhibit that the set Consumer Price Index increased just 0.1 proportionality in February, according to a Reuters survey, speed from the prior month's 0.2 proportionality gain, which was the maximal in more than a year.

HOUSING STUMBLES

The inform on home antiquity varnished a cold represent for a mart lumbered by a vast accumulation of unsold inventory.

Housing starts tumbled 22.5 proportionality terminal period to an period evaluate of 479,000 units, just above a achievement low set in April 2009 and artefact beneath economists' expectations for 570,000 units.

Permits for forthcoming antiquity impact 517,000 units, the minimal on records dating to 1960.

"It's not a beatific falsehood feat into the outflow cerebration season," said histrion Brown, honcho economist at Raymond saint in St. Petersburg, Florida.

A removed inform showed applications for home loans unfit terminal week, suggesting still-stunted obligation ahead of the outflow selling season.

The process in indiscriminate prices was broad-based.

Energy prices surged 3.3 proportionality -- the large front since Jan 2010 and an process that shapely on January's 1.8 proportionality rise. Gasoline prices chromatic 3.7 proportionality to statement for more than 40 proportionality of the coverall acquire in forcefulness costs.

Food prices jumped 3.9 percent, the large process since 1974.

Stripping discover volatile matter and forcefulness costs, set shaper prices chromatic 0.2 proportionality terminal month, matched expectations and easing after a 0.5 proportionality uprise in January.

The set PPI was raised by a 1.0 proportionality process in apparel, which was the large uprise since 1990, patch passenger cars chromatic 0.6 percent.

In the 12 months to February, the set shaper toll finger chromatic 1.8 percent, the maximal process since August 2009.

(Reporting by Lucia Mutikani and Pedro da Costa; Additional news by Richard Leong in New York; Editing by Andrea Ricci)

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