By Jeannine Aversa
The Associated Press

WASHINGTON - Falling costs for gasoline, cars, computers and sporting goods helped push wholesale prices down in November by the largest amount in six months, a potential benefit for consumers but a profit squeeze on some companies.

The Producer Price Index, which measures prices paid to factories, farmers and other producers, dropped by 0.4 percent in November from the previous month, the Labor Department said Friday.

The decline, which surprised analysts who were predicting a flat reading in the PPI, came after wholesale prices shot up by 1.1 percent in October.

While October's spike was led by big jumps in energy and car prices, November's drop reflected steep declines in those costs.

"The inability of many companies to raise prices in a lackluster business environment doesn't bode well for corporate profitability," economist Richard Yamarone of Argus Research Corp. said. "Lower prices for a company's product means lower revenues and thus weaker profits."

Assuming they show up in lower retail prices, falling wholesale prices are one of the few benefits for consumers of a weak economy. For businesses, the picture is mixed. Companies whose product prices are going down might feel even more pressure on already strained profit margins. But companies that buy those lower-priced goods might get a break through cheaper costs to do business.

The 0.4 percent decline in the PPI in November from the previous month matched a drop in wholesale prices registered in May.

For the 12 months ending with November, wholesale prices rose by only 0.9 percent.

"Congress and the White House can consider fresh economic stimulus without undue fear of reviving inflation," said Jerry Jasinowski, president of the National Association of Manufacturers, whose members have been struggling with the uneven economic recovery.

In November, energy prices fell 1.8 percent as tensions receded about supply disruptions that could result from a possible war with Iraq. Those concerns were a factor in driving energy prices up by 4.2 percent in October.

Gasoline prices went down by 9 percent in November, and heating oil fell 11.1 percent, the biggest decline since December 2001.