US producer prices shot up 1.7 per cent last month to post the biggest gain in nearly 15 years as energy costs skyrocketed and food prices surged, a government report showed today.
Even outside of food and energy, producer prices climbed a relatively swift 0.3 per cent in October, the US Labor Department said - well ahead of the 0.1 per cent gain Wall Street had expected.
The increase in the overall Producer Price Index, a gauge of prices received by farms, factories and refineries, was the largest since January 1990 and easily outstripped expectations for a 0.5 per cent gain.
Energy prices soared 6.8 per cent last month, the steepest climb since February 2003, as gasoline costs shot up 17.3 per cent , home heating oil prices rose 17.9 per cent and the price for liquified petroleum gas gained 14.7 per cent .
Residential electricity costs climbed 2.3 per cent. Food prices increased 1.6 per cent, their biggest gain in a year. Vegetable prices rose 34.2 per cent, their largest jump in over eight years, and fruit climbed 11.3 per cent.
Perhaps more troubling from an inflation perspective, prices outside of food and energy continued a relatively steep march upward in October. Still, the year-on-year gain moved down a notch to 1.8 per cent from the 1.9 per cent registered in the 12 months through September.
On the energy price front, some relief could be on the way. Crude oil prices hit a peak above $55 a barrel last month but have come down sharply since then. Crude oil futures settled at $46.87 a barrel in trade in New York on Monday.