Tags: us | economy | Consumer | Inflation | Rises | Higher | Food

Consumer Inflation Rises on Higher Food, Gasoline Costs

Friday, 15 Apr 2011 08:42 AM

Rising food and gasoline prices lifted U.S. consumer inflation as expected in March, but underlying inflation pressures remained contained, a government report showed on Friday.

Those trends came as real income dropped 0.5 percent for the month.

The Labor Department said its Consumer Price Index increased 0.5 percent after rising by the same margin in February. That was in line with economists’ expectations.

Core CPI is vindication for officials at the Federal Reserve who have viewed the recent energy price spike as having a temporary effect on inflation.

Food and gasoline rose 0.8 percent, the largest gain since July 2008, after increasing 0.6 percent in February.

Core inflation last month was lifted by housing and transportation costs.

Shelter costs, which account for about 40 percent of core CPI, rose 0.1 percent, rising by the same margin for a sixth straight month as the recovering economy boosts demand for rental apartments.

There were also increases in new and used vehicle prices, air fares and medical costs. Apparel prices fell 0.5 percent after dropping 0.9 percent in February.

In the 12 months to March, core CPI rose 1.2 percent year-on-year after advancing 1.1 percent in February. Fed officials, however, would like to see that closer to 2 percent.

Overall consumer prices rose 2.7 percent year-on-year, the largest gain since December 2009, after increasing 2.1 percent in February.

'Empire State' Rise

A gauge of manufacturing in New York State rose in April to its highest level in a year, and the state employment index jumped to its highest since May 2004, the New York Federal Reserve said in a report on Friday.

The New York Fed's "Empire State" general business conditions index increased to 21.7 in April from 17.50 in March.

Economists polled by Reuters had expected a figure of 16.90 for April.

The index for the number of employees jumped to 23.1, its highest since May 2004, from 9.09 in March. The average employee workweek index, however, slipped to 10.3 from 15.58 in March.

The prices paid index rose to 57.69, the highest level since August 2008, from 53.25.

The survey of manufacturing plants in the state is one of the earliest monthly guideposts to U.S. factory conditions.

© 2017 Thomson/Reuters. All rights reserved.

 
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Rising food and gasoline prices lifted U.S. consumer inflation as expected in March, but underlying inflation pressures remained contained, a government report showed on Friday. Those trends came as real income dropped 0.5 percent for the month. The Labor Department said...
us,economy,Consumer,Inflation,Rises,Higher,Food,Gasoline,Costs
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2011-42-15
Friday, 15 Apr 2011 08:42 AM
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