In a second report, the Labor Department said its seasonally adjusted Producer Price Index increased 0.7 percent last month after advancing 0.2 percent in January.
In the 12 months through February, prices received by farms, factories and refineries were up 1.7 percent, the fastest rise since October and followed a 1.4 percent gain the prior month.
However, underlying inflation pressures remained contained, with wholesale prices excluding volatile food and energy costs rising 0.2 percent after a similar advance in January.
In the 12 months through February, core PPI was up 1.7 percent, the smallest rise since January 2011. It had increased 1.8 percent in January.
While gasoline prices pushed up overall PPI last month, they have started to decline from their lofty levels, which should keep inflation pressures benign and boost consumers' purchasing power.
The steady job gains are helping to prop up wages, supporting domestic demand. Though layoffs have ebbed, sluggish domestic demand has made companies cautious about ramping up hiring.
A government report on Tuesday showed layoffs in January were the fewest since 2000. The signs of strength in the labor market could intensify the debate at the Fed on the future course of monetary policy.
Despite the improvement in the jobs market, economists do not expect a shift in policy anytime soon.
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"The Fed will not exit until they are sure the economy is on a sustained path. This is not going to tip their thinking about stimulus because these things could peter out like what we saw (in the) last couple of years," said Ellis.
Policymakers meet next week to assess economic conditions.
Concerns over high unemployment prompted the U.S. central bank last year to launch an open-ended bond buying program, but divisions are emerging among policymakers about the program.
The central bank is buying $85 billion in bonds per month and has said it would keep up its asset purchases until it sees a substantial improvement in the labor market outlook.
It hopes the purchases will drive down borrowing costs to spur faster economic growth.
The number of people still receiving benefits under regular state programs after an initial week of aid dropped 89,000 to 3.02 million in the week ended March 2. These so-called continuing claims were at their lowest level since June 2008.
Current Account Deficit Up
The U.S. current account deficit narrowed in the fourth quarter, aided by an increase in services exports and more income earned abroad, a government report showed.
The Commerce Department said the current account deficit, which measures the flow of goods, services and investments into and out of the country, fell to $110.4 billion, from an upwardly revised $112.4 billion in the third quarter.
That represented 2.8 percent of gross domestic product, unchanged from the third quarter, and tied for the lowest since 2.5 percent in the second quarter of 2009.
The smaller deficit should be supportive of the dollar, even as the Federal Reserve continues its aggressive easing policy to boost economic growth.
Economists polled by Reuters expected the fourth-quarter current account gap to widen to $112.8 billion from a previously reported $107.5 billion for the third quarter.
The shortfall on the current account has narrowed from a peak of 6.5 percent of GDP in the fourth quarter of 2005.
In the fourth quarter, the deficit on goods increased to $180.6 billion from $174.2 billion in the prior quarter, the Commerce Department said.
The services surplus increased to $52.2 billion in the fourth quarter to $49.3 billion in the third and the surplus on income increased to $52.4 billion in the fourth quarter, from $46.6 billion in the third.