Gasoline Costs Rise; Increase Prices by Most in 3 years
MIXED INFLATION MESSAGE: A sharp rise in gasoline costs drove up wholesale prices last month by 1.7 percent in August, the most in more than three years. But outside energy and food, price gains were mild — up 0.2 percent.
ENERGY EFFECT: The rise in the overall producer price index, which measures price changes before they reach the consumer, was mostly because gas prices soared 13.6 percent, the biggest gain in three years. Food prices rose 0.9 percent.
THE OUTLOOK: Food prices are likely to rise further in the coming months as the Midwest drought has made corn, soybeans and other grains much more expensive. But overall, economists aren’t worried that inflation is rapidly accelerating, given weak U.S. economic growth and high unemployment.