Wholesale prices continued to rise rapidly last month, the government said yesterday. The developments maintained pressure on the Carter administration to take new steps to combat inflation.
Although the increase was smaller than the 1.1 percent in February, the Labor Department's index showed prices of so-called producers' finished goods still jumped 0.6 percent - an annual rate of 7.2 percent.
The administration's own inflation-watchdog agency, the Council on Wage and Price Stability, warned that inflation "shows no sign of abating" under existing policies, and said new efforts were needed to help check rising prices.
In a special report, the council warned that, without new actions, inflation "seems hopelessly stuck" at the present rate of 6 to 7 percent, and even this forecast "is in jeopardy."
Barry P. Bosworth, the agency's director, told a Senate Finance subcommittee separately that if Congress cut Social Security taxes by $30 billion, as some members are advocating, it could reduce inflation by 1 percent a year. That is because the employer half of these taxes is a part of labor costs, and afects prices directly.
President Carter is nearing decisions on a series of anti-inflation proposals, including a 5 to 6 percent ceiling on federal pay raises. The White House said yesterday he will announce the plan on Tuseday.
Bosworth had recommended that the administration go along with rolling back recent Social Security tax increases as in anti-inflation measure, but Carter has decided against that step. Yesterday Bosworth supported the president.
The report on wholesale prices showed the bulk of the March increase stemmed from unusually large increases in farm prices - suggesting that the farm "crisis" some farmers have been complanining about may be begining to fade.
Prices of food ready to be shipped to supermarkets rose a sizable 0.8 percent, following a 2.9 percent jump in February. The February increase had reflected short supplies resulting from severe weather.
Prices of no food items - regarded as a more reliable indicator of underlying inflation trends - rose 0.5 percent in March, up slighty from February's 0.4 percent.
Howeve, in an ominous note, prices of goods sold at earlier stages of procesing - such as semi-finished gods and raw materials - continued to rise sharply, pointing to further inflation in coming months.
Prices of goods at the intermediate stages of processing rose 0.8 percent in March, maintaining the momentum of 0.9 percent increases in each of the two previous months.
Raw materials prices rose 1.6 percent, the Labor Department report found.
The wage-price council's gloomy assessment of the inflation outlook was part of a detailed 160-page report the agency issued, apparently to underscore its contention that action is needed to combat inflation.
The document blamed a variety of factors for the present inflation rate - from changes in the economy's structure to a decline in competition in key industries and a trend toward built-in wage increases in labor contracts.
"People naturally want to catch up with rival groups," it said. "The difficulty is that the sum of the gains - promised and anticipated - exceeds the economy's capacity to provide them, and ultimately inflation" results.
The report warned that "further delay in achieving some progress toward reducing inflation could be costly." If inflation can't be slowed when unemployment is high, it said, the achievement "will be even more difficult" later.
The March figures on wholesale prices brought the pace of inflation at the wholesale level over the past three months to an annual rate of 9.6 percent - up from 9.2 percent for the three months ended in February.
Over the past 12 months, prices paid to products have risen 6.5 percent. Prices of food items have gone up 7.2 percent, while those of other goods have risen 5.3 percent.
Changes in wholesale prices do not necessarily result in dollar-for-dollar increases in retail prices, but they do have some impact over time. The index was revamped in February to reflect actual prices more accurately.
The March figures left the overall index at 189 percent of its 1967 average. That means it took $189 to buy the same goods at "wholesale" that cost $100 then.