Record jump in gas prices

first_imgWASHINGTON – A record jump in gasoline prices pushed up wholesale inflation in November at the fastest pace in more than three decades, while retail sales showed unexpected strength.The Labor Department said Thursday that wholesale prices rose by 3.2 percent last month, the biggest increase in 34 years. The jump reflected a 34.8 percent surge in gasoline prices. Outside of energy and food, core inflation posted a 0.4 percent jump, double what was expected.But in more upbeat economic news, the Commerce Department reported that retail sales increased by a better-than-expected 1.2 percent last month. It was the biggest sales advance in six months and evidence of widespread strength in a number of areas, from department stores to clothing shops and furniture stores.On Wall Street, stocks posted a modest gain, rising by 44.06 points to close at 13,517.96. AD Quality Auto 360p 720p 1080p Top articles1/5READ MOREWhicker: Clemson demonstrates that it’s tough to knock out the champEconomists said the retail sales gain should ease concerns the economy is about to tumble into a recession, although they said overall growth in the current quarter is still likely to be weak given the headwinds battering consumers. Those troubles include the slump in housing, a severe credit crunch and surging energy costs. These problems pushed consumer confidence down to the lowest point in two years, leading economists to forecast a subpar performance by holiday shoppers this year.The big jump in wholesale prices was worrisome, economists said, because it was not limited to energy. That suggests that the relentless surge in energy prices could be spreading into more widespread inflation, something that would raise alarm bells at the Federal Reserve.“I think the Fed has some worries on inflation,” said David Wyss, chief economist at Standard & Poor’s in New York. “We are starting to see some leakage from energy into other areas of the economy.” 160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set!last_img read more