The stock market fell for the first time in five days and Treasurys slipped after a jump in inflation stoked concerns that the Federal Reserve would be forced to raise interest rates.

Stocks extended their losses late in the day Tuesday after General Electric Co. forecast that revenue and earnings would be largely flat in 2010.

Major stocks indexes fell 0.5 percent from 14-month highs, including the Dow Jones industrial average, which lost 49 points.

Trading was subdued as Fed policymakers gathered for a two-day meeting on interest rates. The Fed isn't expected to raise rates from their record low level, but the day's economic reports brought reminders that the central bank could be forced to raise rates sooner than expected to keep inflation at bay.

The government said wholesale prices jumped 1.8 percent last month, more than double the gain analysts expected. Core inflation, which excludes often-volatile food and energy costs, rose 0.5 percent, the biggest increase in more than a year.

Analysts said the increase in food and energy costs was likely a concern for Fed officials.

"They're the twin pistons of inflation," said Christopher Wolf, managing partner and co-chief investment officer at Cogo Wolf Asset Management LLC in San Francisco.

Meanwhile, the Fed said industrial production rose 0.8 percent in November, the biggest gain since August. The rise in production meant factories ran at a higher capacity. The portion of capacity being used remains below average, but if factories start seeing demand increase prices could rise.

The reports put inflation on investors' screens. If prices start rising and the Fed raises rates, it could choke off a nascent economic recovery. The Fed is expected to release a statement on the economy and interest rates Wednesday afternoon after its meeting.

"There is a fair chance that the Fed is going to have to start putting some brakes on the economy," Wolf said, adding that he doesn't expect any immediate actions from policymakers.

Higher rates would help shore up the dollar, which rose Tuesday, but has fallen against other major currencies since stocks began rising in March. It could also trip up the stock market as traders realign their holdings.

Stocks have slowed their nine-month advance in December as traders look to lock in gains for the year and seek clues about what might be able to drive the market in 2010. The benchmark Standard & Poor's 500 index has jumped 63.8 percent from a 12-year low in March on relief that the economy appears to be stabilizing. Analysts say investors will need substantive signs that the economy is improving to extend the gains next year.