PRC Chairman Predicts 5% Rate Hike In 2009

Wondering What You Can Expect in terms of a postal rate hike next May? Dan G. Blair, chairman of the Postal Regulatory Commission believes the average increase for each class of mail will be about 5%. The actual rate cap will depend upon the behavior of the monthly CPI (Consumer Price Index) at the end of December.

The cap is based on an average over two consecutive 12-month periods, Blair says. “The current value (as of Oct. 21) is 4.4%, and we’ve witnessed an upward trend over the past year.”

The Postal Service confirmed in November it has ended fiscal year 2008 with a volume decline of 9 .5 billion pieces and a net loss of $2.8 billion. “Given the current rate at which the Service is losing money,” Blair says, “it is likely that the rate change in all classes will be close to the cap.”

In other USPS news, the agency announced Nov. 13 it was moving up the date for its parcel service rate increase from May to Jan. 18. Postal officials say that the move is to help offset its losses faster. It will also put USPS on the same pricing schedule as its major parcel carrier competitors.

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