The economy received another inflation warning on Wednesday, when a survey of industry executives showed that energy costs drove prices higher in September while the services sector slowed. The report reinforced expectations that the Federal Reserve would continue to raise rates as the economy struggles with rising fuel costs aggravated by Hurricane Katrina.
The Institute of Supply Management, which conducted the survey, said its non-manufacturing business activity index was at 53.3 percent in September, down from August’s reading of 65 percent. The group’s index of prices paid rose 14.3 points to 81.4 percent, the highest level and the biggest jump for the index in the eight-year history of the report.
