Wholesale Prices in U.S. Rise More Than Economists Estimated on Food, Fuel

Wednesday, October 19, 2011
By Paul Martin

By Shobhana Chandra
Bloomberg.com
Oct 18, 2011

Wholesale prices in the U.S. rose more than forecast in September, boosted by gasoline, food and trucks, indicating inflationary pressures continue to bubble up the production line.
The producer price index climbed 0.8 percent, the most in five months, after no change in August, Labor Department figures showed today in Washington. Economists projected a 0.2 percent gain, according to the median of 71 estimates in a Bloomberg News survey. The so-called core measure, which excludes volatile food and energy, gained 0.2 percent, also more than predicted.

Slower growth from China and Europe to the U.S. means demand for raw materials will probably moderate, helping limit further gains in prices. A pickup in expenses would call into question whether inflation will cool enough to give Federal Reserve policy makers room to further spur the recovery should the world’s largest economy falter.

“With the slowdown in global economic activity, it’s hard to make the case that prices will accelerate more meaningfully from here,” said Tom Porcelli, chief U.S. economist at RBC Capital Markets Corp. in New York, who correctly projected the increase in core prices.

The Rest…HERE

Leave a Reply

Support Revolution Radio