WASHINGTON, Feb 17 (Reuters) – U.S. core consumer prices
rose at their quickest pace in more than a year in January,
government data showed on Thursday, but the increase was not
strong enough to suggest a build-up in inflation pressures.
The Labor Department said its core Consumer Price Index,
excluding food and energy, increased 0.2 percent — the largest
gain since October 2009 — after rising 0.1 percent in
December.
The increase, which was above economists’ expectations for
a 0.1 percent gain, was driven by rises in the cost of apparel,
shelter and airline fares. At most, the rise suggests the
disinflationary trend in core inflation has bottomed.
Overall CPI rose 0.4 percent after increasing by the same
margin in December. Food and energy accounted for over
two-thirds of the rise in overall CPI.
Economists had expected headline CPI to rise 0.3 percent last
month.
The report came a day after the government reported core
wholesale prices increased at their fastest pace in more than
two years in January, raising concerns among some investors
that inflation might be building up.
Despite the slightly above expectations rise in January,
the consumer inflation report tended to support the Federal
Reserve’s views that inflation remains too low.
The report showed prices for new vehicles and used cars
declining.
Surging commodity prices have put global central banks on
the alert for inflation.
In the 12 months to January, core inflation rose 1.0
percent after rising 0.8 percent in December. That was the
largest gain since March. Economists had expected a
year-on-year rate of 0.9 percent.
(Reporting by Lucia Mutikani, Editing by Andrea Ricci)