US wholesale inflation picked up more than expected in August, government data showed on Thursday, driven by higher energy costs in the month – particularly for diesel – as the US war on Iran continued.

The Producer Price Index (PPI) was up 5.4 percent year-on-year last month, the Department of Labour said. This was a significant acceleration from the 4.8 percent rise in July.

On a month-on-month basis, PPI rose by 0.4 percent.

Energy costs jumped by 4.2 percent over the month, notably boosted by the cost of diesel fuel, which surged 24.1 percent, the report said.

Rising prices at the pump have squeezed US households and businesses since US-Israeli strikes targeting Iran in late February prompted Tehran to choke off the Strait of Hormuz in retaliation.

The waterway is a crucial route for global energy transit, sending costs up and piling pressure on voters weeks ahead of key US midterm elections.

The price of diesel, the fuel needed for road hauling and agriculture, has rocketed to a new record in the United States this week.

It now stands at a national average of US$5.98 per gallon, significantly up from the year-ago average of US$3.71 per gallon, according to the AAA motorists' association. (AFP)



Edited by Robert Kemp