U.S. wholesale prices fall by largest amount in three years

Wholesale prices in the United States fell by 1.3 percent in September, the largest amount in more than three years, the Labor Department reported Tuesday.

The retreat in wholesale prices, a measure of inflation at wholesale level, was nearly double the decrease that analysts had been expecting.

In September, overall energy costs dropped 8.4 percent, the first decline at the wholesale level since last February and the biggest one since July 1986.

Gasoline prices plunged by 22.2 percent, the biggest decline on record, surpassing the old mark of a 22.1 percent drop in March 1986. Heating oil prices were down 18.5 percent while costs of residential natural gas rose by 1.8 percent.

Food prices increased by 0.7 percent in September. Pork prices surged 81.1 percent, the biggest gain since September 1999. The price of fish and rice also increased.

The core wholesale prices excluding energy and food rose by 0.6 percent in September, the biggest since an equal 0.6 percent rise in January 2005.

The rise was pushed by a jump of 2.8 percent in new car prices, the biggest gain in 16 years, and a 3.5 percent increase in light truck prices, the biggest increase in 21 years.

Analyst expected that a slowing economy and a recent retreat in global oil prices would help to lower inflation pressures in coming months. They believed that the Federal Reserve would keep a key short-term interest rate unchanged in its next meeting later this month.

Source: Xinhua