US sees 9th straight CPI rise
Source: Bloomberg News |
April 16, 2011, Saturday
|
Print Edition
Print Edition
THE cost of living in the United States rose in March for a ninth consecutive month, led by increases in food and fuel costs that have yet to filter down to other goods and services.
The Consumer Price Index increased 0.5 percent for a second month, in line with the median forecast of economists surveyed by Bloomberg News, figures from the US Labor Department showed yesterday. Excluding volatile food and energy, the so-called core gauge rose 0.1 percent, less than forecast and restrained by lower clothing expenses and smaller gains in medical care.
Unemployment at 8.8 percent and falling wages adjusted for inflation mean retailers and service providers will have a hard time passing price increases along to customers. Rising food and gasoline prices are limiting consumer purchases of other goods, slowing the economic recovery.
"There are fairly subdued pressures outside of food and energy," said Sal Guatieri, a senior economist at BMO Capital Markets Inc in Toronto, who correctly forecast the core rate. "There is still little appetite on the part of consumers to absorb cost increases and retailers are finding it difficult to pass rising input costs onto consumers, largely because consumer wages are rising very modestly."
Another report showed factories continue to propel the economic expansion. The Federal Reserve Bank of New York's general economic index rose to 21.7 from 17.5 in March. Figures greater than zero signal factory expansion in the so-called Empire State Index, which covers New York, New Jersey and Connecticut.
Forecasts for consumer prices in the Bloomberg survey of 82 economists ranged from gains of 0.3 percent to 0.9 percent.
Economists projected the core gauge would rise 0.2 percent, according to the survey median. The 0.1 percent increase last month was the smallest since December.
Prices increased 2.7 percent in the 12 months ending March, the biggest year-to-year gain since December 2009.
The Consumer Price Index increased 0.5 percent for a second month, in line with the median forecast of economists surveyed by Bloomberg News, figures from the US Labor Department showed yesterday. Excluding volatile food and energy, the so-called core gauge rose 0.1 percent, less than forecast and restrained by lower clothing expenses and smaller gains in medical care.
Unemployment at 8.8 percent and falling wages adjusted for inflation mean retailers and service providers will have a hard time passing price increases along to customers. Rising food and gasoline prices are limiting consumer purchases of other goods, slowing the economic recovery.
"There are fairly subdued pressures outside of food and energy," said Sal Guatieri, a senior economist at BMO Capital Markets Inc in Toronto, who correctly forecast the core rate. "There is still little appetite on the part of consumers to absorb cost increases and retailers are finding it difficult to pass rising input costs onto consumers, largely because consumer wages are rising very modestly."
Another report showed factories continue to propel the economic expansion. The Federal Reserve Bank of New York's general economic index rose to 21.7 from 17.5 in March. Figures greater than zero signal factory expansion in the so-called Empire State Index, which covers New York, New Jersey and Connecticut.
Forecasts for consumer prices in the Bloomberg survey of 82 economists ranged from gains of 0.3 percent to 0.9 percent.
Economists projected the core gauge would rise 0.2 percent, according to the survey median. The 0.1 percent increase last month was the smallest since December.
Prices increased 2.7 percent in the 12 months ending March, the biggest year-to-year gain since December 2009.
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