US wholesale prices rise most in three years Wholesale prices in the US rose the most in three years in August as food and energy costs jumped. The labour department said its producer price index rose 1.7 per cent on a seasonally adjusted basis last month, the largest gain since June 2009, after increasing 0.3 per cent in July. Analysts surveyed by Bloomberg expected the index to climb 1.4 per cent. Core wholesale prices, which exclude volatile food and energy prices, edged 0.2 per cent higher, matching analysts" expectations. They slowed from a 0.4 per cent increase in July. Companies might find it difficult to pass on higher costs as the global economic slowdown and the looming "fiscal cliff" of higher taxes and government spending cuts prompt their customers to limit spending. The PPI is one of several inflation measures monitored by the US Federal Reserve. The consumer price index, set for release on Friday, is expected to show a 0.6 per cent increase for the month of August. The Fed is expected to announce the launch of a third round of its bond purchasing programme at its meeting later on Thursday, in an effort to reverse slowing momentum in the world's largest economy. From the Fed's perspective, the main way a surge in energy or food costs could affect the underlying trend in inflation significantly would be if it led to a jump in inflation expectations. So far, that has not happened," said Jim O'Sullivan, chief US economist at High Frequency Economics. Overall wholesale prices were boosted last month by a 6.4 per cent increase in energy prices, the biggest rise in three years. The energy component was buoyed by a 13.6 per cent surge in petrol prices, which analysts said reversed cumulative declines going back to March. Food prices rose 0.9 per cent, the largest gain since November, after a 0.5 per cent gain in July. Higher dairy costs accounted for a third of the increase last month and could remain elevated as a severe drought pushes up the cost of grain and soybeans. In the 12 months to August producer prices increased 2 per cent, the biggest year-on-year gain since March, following a 0.5 per cent increase in July. Outside food and energy, passenger car costs dipped 0.2 per cent while light trucks jumped 0.6 per cent in August. Pharmaceutical product prices increased 0.5 per cent, accounting for more than a third of the core PPI increase. Separate data released on Thursday showed the number of Americans filing new claims for jobless benefits rose more than expected last week, with several states reporting an increase related to tropical storm Isaac. The number of first-time claims for unemployment insurance rose 15,000, the biggest gain in almost two months, to 382,000 in the week ended September 8. This came in above consensus forecasts of 370,000 and was higher than the previous week's upwardly revised level of 367,000, according to the labour department. "Claims were pushed higher partially as a result of tropical storm Isaac and the seasonal distortions associated with a shortened holiday work week [from Labor Day]," said Michael Gapen, director of US economic research and global asset allocation at Barclays. "We look for much of the rise in initial claims to be reversed in subsequent weeks and do not interpret this week's claims data as the beginning of an adverse trend in the rate of job separation," he added. Initial jobless claims reflect weekly firings and tend to fall as job growth - measured by the monthly non-farm payrolls report - accelerates. Even as some recent data has shown signs of improvement in the labour market, the US created only 96,000 jobs in August, after a downwardly revised 141,000 increase in July. The four-week new claims average, which smooths out the volatility of the weekly data, climbed to 375,000 last week, the highest in almost two months, from 371,750. The number of people continuing to collect jobless benefits fell 49,000 in the week ending September 1 to 3.28m. Those Americans who used up their traditional benefits and were collecting emergency and extended payments decreased about 41,000 to 2.23m in the week ending August 25.