Inflation climbs 0.6% in America
Source: Agencies |
October 17, 2012, Wednesday
|
Print Edition
Print Edition
HIGHER gasoline costs drove up US consumer prices in September for the second straight month. Outside energy, there was little sign of inflation.
The US Labor Department yesterday said the Consumer Price Index rose a seasonally adjusted 0.6 percent last month, matching the August increase. In the past 12 months, prices have increased 2 percent. That's in line with the Federal Reserve's inflation target.
Excluding volatile food and energy costs, prices rose just 0.1 percent. In the past year, core prices have increased 2 percent.
"Pump prices are fueling headline inflation, but underlying ... trends remain benign," said Robert Kavcic, an economist at BMO Capital Markets.
Modest inflation leaves consumers with more money to spend, which can boost growth. Low inflation also allows the Federal Reserve to continue with its efforts to rekindle the economy. If the Fed were worried that prices are rising too fast, it might have to raise interest rates.
Food prices rose only 0.1 percent. The cost of meat, chicken and eggs fell. Dairy prices rose.
Gasoline prices rose sharply over the summer and into September, but have since come down. The average price for a gallon of gasoline nationwide was US$1 a liter on Tuesday, about 9 US cents below last month's level.
The report noted that gasoline prices rose a seasonally adjusted 7 percent in September, below August's 9 percent increase.
Paul Ashworth, an economist at Capital Economics, said that with gasoline prices leveling off, overall inflation should stabilize at around 2 percent for the next several months and then decline.
The US Labor Department yesterday said the Consumer Price Index rose a seasonally adjusted 0.6 percent last month, matching the August increase. In the past 12 months, prices have increased 2 percent. That's in line with the Federal Reserve's inflation target.
Excluding volatile food and energy costs, prices rose just 0.1 percent. In the past year, core prices have increased 2 percent.
"Pump prices are fueling headline inflation, but underlying ... trends remain benign," said Robert Kavcic, an economist at BMO Capital Markets.
Modest inflation leaves consumers with more money to spend, which can boost growth. Low inflation also allows the Federal Reserve to continue with its efforts to rekindle the economy. If the Fed were worried that prices are rising too fast, it might have to raise interest rates.
Food prices rose only 0.1 percent. The cost of meat, chicken and eggs fell. Dairy prices rose.
Gasoline prices rose sharply over the summer and into September, but have since come down. The average price for a gallon of gasoline nationwide was US$1 a liter on Tuesday, about 9 US cents below last month's level.
The report noted that gasoline prices rose a seasonally adjusted 7 percent in September, below August's 9 percent increase.
Paul Ashworth, an economist at Capital Economics, said that with gasoline prices leveling off, overall inflation should stabilize at around 2 percent for the next several months and then decline.
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