Stamp Prices Increasing in 2006

WASHINGTON (Reuters) - The cost of mailing a letter in the United States will rise two cents to 39 cents under a rate hike approved by the U.S. Postal Rate Commission on Tuesday.

The increase, the first in three years, was not expected to take effect before early next year, the commission said in a statement.

The cost of a first-class postage stamp will rise from 37 to 39 cents while the cost of sending a postcard will increase by one penny to 24 cents, the commission said.

It will be the first increase in U.S. postage rates since June 2002.

The U.S. Postal Service requested a 5.4 percent across-the-board rate increase to meet a $3.1 billion escrow payment due in 2006, the commission said.

The new rate plan approved by the Postal Rate Commission will cut mailing costs for small local newspapers by 2.3 percent.

However, the commission said the rates sought for books and media materials was too low to cover the cost of handling that mail and recommended a 12.7 percent increase.