Washington, May 10 (Bloomberg) -- Prices paid to U.S. factories, farmers and other producers probably rose in April, led by higher energy costs, economists said in advance of a government report set for release today. The 0.4 percent rise expected in the producer price index, based on the median of 61 forecasts in a Bloomberg News survey, would follow a 1 percent gain in March. Excluding food and energy, the index probably rose 0.1 percent, the 11th straight reading of that amount or less and a sign that cost increases for most goods at the wholesale level are stable. ``Outside of energy, there's not a lot of pressure on prices,'' said Diane Swonk, chief economist at Bank One Corp. in Chicago. In March, the total price index was down 1.4 percent from a year earlier and ``is coming off of such low levels it's not much of an issue.'' Few companies are raising prices because the U.S. economy is still recovering from recession and businesses don't want to risk losing customers. Intel Corp. the world's largest chipmaker, and General Motors Corp., the biggest automaker, have used discounts to spur sales. The Labor Department is scheduled to release the report at 8:30 a.m. Washington time. Economists watch producer prices to determine whether inflationary pressures are building. Federal Reserve policy makers have said the risks of accelerating inflation are about equal to the chances of a slowdown in economic growth. Intel last week lowered, by as much as 28 percent, the prices of three Celeron chips that power laptop computers. The company drops prices of older processors as it unveils new ones, spokesman Robert Manetta said. The company started selling three new Pentium 4 processors for laptops last month.

General Motors
General Motors extended cash rebates and no-interest financing on most models until April 30. The loans show up as a price decline because automakers absorb the financing costs. Manufacturers are able to counter energy price increases and discounts by boosting worker efficiency. In the first quarter, manufacturing productivity rose at a 9.7 percent annual rate, the fastest in more than two years, as companies operated with fewer people on assembly lines while production increased. That reduced unit labor costs at factories by 1.7 percent, helping profit margins. Low inflation and high productivity help explain why Fed policy makers have left the overnight bank lending rate at a 40- year low of 1.75 percent since December. With little price pressure, central bankers have room to focus on growth.

Steel Tariffs
Steel prices rose after U.S. President George W. Bush in March imposed tariffs ranging from 8 percent to 30 percent on most steel products. The tariffs, which took effect March 20 and last for three years, will raise the cost of steel in products from refrigerators to cars by as much as 10 percent, the administration said. Leggett & Platt Inc., the world's largest maker of springs, wires and fabric for furniture, in April said it would pass along higher steel prices to its customers. It said it is seeing higher costs for raw materials such as sheet steel, lumber and steel rod. Economists say such higher costs don't reflect the marketplace. ``All of these represent prices driven by shortages caused by artificial constraints on the supply side rather than excessive demand,'' said Chris Low, chief economist at First Tennessee Bank in New York, in a report. ``As such, they aren't going to result in a permanent rise in inflation.'' Yesterday, government statistics showed the prices of goods imported to the U.S. increased in April for a second straight month, reflecting higher energy costs. The 1.4 percent increase in the import price index, the biggest in almost two years, followed a 1.2 percent gain in March. Excluding petroleum, the gauge of costs for goods purchased overseas increased 0.4 percent in April after rising 0.1 percent in March.