Falling energy prices curb US inflation
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WASHINGTON, Feb 21 AFP
February 22 2013, 02:23AM
US consumer prices were flat for a second month in a row in January, held down by a sharp drop in petrol and fuel oil prices.
The Labor Department said on Thursday its consumer price index was unchanged, while core CPI, excluding food and energy, rose 0.3 per cent.
The energy sub-index fell 1.7 per cent, its third consecutive decline, led by 3.0 per cent drops in prices for petrol and fuel oil that offset a 1.1 per cent rise in electricity costs.
Food prices were unchanged after inching up 0.2 per cent in the prior three months.
In the overall CPI, clothing was the strongest price gainer, up 0.8 per cent.
The data underscored continued weak inflationary pressures in the sluggish economy, which contracted 0.1 per cent in the fourth quarter of 2012 despite massive stimulus from the Federal Reserve.
Year-over-year, CPI slowed for a third straight month, rising 1.6 per cent in January, its lowest rise in six months. In January 2012, CPI was up 2.9 per cent from the year-ago month.
Core CPI was up 1.9 per cent from a year ago, driven by a 3.8 per cent jump in airline fares and a 3.1 per cent rise in medical care costs.
"The year/year gain has been hovering around the two per cent mark for the past seven months, and shouldn't worry Fed officials too much," said Jennifer Lee of BMO Capital Markets.