Oct 5, 2009 - A Reuters report this morning says that Caterpillar Inc., the world's largest maker of earth-moving equipment, plans to raise prices on most of its machinery up to two per cent next year.

The U.S. manufacturer said in a filing with the Securities and Exchange Commission the increase would reflect "current industry factors and current and expected general economic conditions."

Separately, Morgan Stanley raised its target price on the Peoria, Illinois-based company's shares, which it rates "underweight," to $44 from $34, saying it now expects machinery sales to rise two percent next year. Previously it had forecast a 4 percent decline.

Caterpillar shares were up three percent at $50.25 on the New York Stock Exchange in early trading. So far this year they are up nine percent, outpacing the eight percent rise of the Dow Jones industrial average.