Wholesale price spike of 1.9 percent raises US inflation fears

0 Comments | AFP, October, 2005

WASHINGTON (AFP) — US wholesale prices surged 1.9 percent in September as energy prices skyrocketed, the government said, in a report heightening fears about inflation in the overall economy.

But the "core" rate of the producer price index (PPI), excluding food and energy, increased a more modest 0.3 percent, the Labor Department reported.

Both the headline and core rates were higher than expected on Wall Street -- where analysts projected a rise of 1.2 percent and 0.2 percent, respectively -- and highlighted concerns about increasing inflationary pressures.

The 1.9 percent jump has not been exceeded since 1974 amid the Middle East oil embargo, analysts noted.

"Slowly, but inexorably, inflationary pressures are building across the economy," said Joel...