By Bob Willis Nov. 19 (Bloomberg) -- The cost of living in the US probably slid in October by the most in almost six decades as fuel costs plummeted and retailers discounted merchandise to entice shell-shocked customers, economists said before a...

Triggered by the highest recorded drop in gasoline prices, U.S. wholesale prices fell by 2.8 percent in October, the steepest one–month drop on record, the Bureau of Labor Statistics reported Tuesday.

Prices for energy goods fell 12.8 percent, nearly 10 percentage points more than their 2.9 percent decline in September. Leading the downturn were gasoline prices, which plunged 25 percent in October from 0.5 percent the month prior.

"We went from $150 per barrel of crude oil down to below $60 per barrel -- quite a decline," said Adolfo Laurenti, senior economist at Mesirow Financial Holdings Inc. in Chicago.

The report, known as the Producer Price Index for Finished Goods (PPI), measures changes in the rate of inflation on U.S. goods and prices of goods before they reach consumers. It also captures the cost of imports.

The PPI generally provides an advance indication of the direction of the Consumer Price Index (CPI), which measures consumer spending based on a theoretical basket of goods and services.

Long-dated government debt prices rose on the news, suggesting that plummeting energy prices have lessened inflation pressure.

With the economy sinking, economists had feared deflation and falling prices throughout the year, but in recent weeks, had focused their worries on the sagging economy rather than inflation rates.

"This is a comforting report in terms of inflation, but there is a flip...
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