Consumer prices rebound thanks to higher gas prices
US consumer prices rebounded 0.2 percent in February as gasoline prices rose for the first time since June. There were also signs of an uptick in underlying inflation pressures, which could keep a June interest rate increase on the table.
Shoppers walk past an advertisement for retailer "bebe" along Lincoln Road Mall, a pedestrian street featuring retail stores and outdoor cafes, in Miami Beach, Fla. The Labor Department reported a 0.2 percent increase in the Consumer Price Index for February on Tuesday, March 24, 2015. (AP Photo/Lynne Sladky)
Lynne Sladky/AP/File
U.S.聽consumer聽prices聽rebounded in February as gasoline聽prices聽rose for the first time since June, and there were also signs of an uptick in underlying inflation pressures, which could keep a June interest rate increase on the table.
The Labor Department said on Tuesday its聽Consumer聽Price Index increased 0.2 percent last month after declining 0.7 percent in January. That ended three straight months of declines in the index.
In the 12 months through February, the CPI was unchanged after slipping 0.1 percent in January. Economists polled by Reuters had expected the CPI to rise 0.2 percent from January and slip 0.1 percent from a year ago.
Federal Reserve officials have long viewed the energy-driven weakness in inflation as transitory.聽The U.S. central bank, which has a 2 percent inflation target, has kept its short-term interest rate near zero since December 2008.
Fed Chair聽Janet Yellen聽said last week policymakers could raise interest rates when they had "seen further improvement in the labor market" and were "reasonably confident that inflation will move back to its 2 percent objective over the medium term."
The so-called core CPI, which strips out food and energy costs, increased 0.2 percent in February after a similar gain in January. In the 12 months through February, the core CPI rose 1.7 percent, the largest increase since November.
Crude oil聽prices聽fell 60 percent between June and January on fears of a global oil glut and the refusal of聽Saudi Arabia聽and other OPEC members to cut output. In February, Brent stabilized at around $60 and U.S. crude at around $50.
Last month, domestic gasoline聽prices聽rose 2.4 percent, the largest increase since December 2013, after tumbling 18.7 percent in January. Gasoline聽prices聽had declined for seven straight months.
Food聽prices聽increased 0.2 percent. Elsewhere, shelter costs increased 0.2 percent, accounting for about two-thirds of the increase in the core CPI. Shelter costs had advanced 0.3 percent in January.
Apparel聽prices聽rose 0.3 percent in February after a similar gain in January. There were also increases in airfares, new motor vehicle and used cars and trucks聽prices. However, the cost of medical care services declined for the first time since 1975.