U.S. con­sumer prices see first fall in months

The Daily Star (Lebanon) - - BUSINESS -

WASH­ING­TON: U.S. con­sumer prices fell for the first time in nine months in De­cem­ber amid a plunge in gaso­line prices, but un­der­ly­ing in­fla­tion pres­sures re­mained firm as rental hous­ing and health care costs rose steadily.

Over­all, the re­port from the La­bor De­part­ment Fri­day pointed to mod­er­ate in­fla­tion, which could sup­port re­cent state­ments by Fed­eral Re­serve of­fi­cials for cau­tion about rais­ing in­ter­est rates this year.

“The Fed will take this as fur­ther proof that price pres­sures are build­ing more slowly than some have feared based on the strong growth of late and tight la­bor mar­ket,” said James McCann, se­nior global econ­o­mist at Ab­erdeen Stan­dard In­vest­ments. “It cer­tainly seems to jus­tify the Fed’s mes­sage about be­ing more pa­tient on rate in­creases.”

The Con­sumer Price In­dex dipped 0.1 per­cent last month, the first drop and weak­est read­ing since March. It was un­changed in Novem­ber. In the 12 months through De­cem­ber, the CPI rose 1.9 per­cent after in­creas­ing 2.2 per­cent in Novem­ber.

Ex­clud­ing the volatile food and en­ergy com­po­nents, the CPI in­creased 0.2 per­cent, up by the same mar­gin for a third straight month. In the 12 months through De­cem­ber, the so-called core CPI rose 2.2 per­cent, match­ing Novem­ber’s in­crease.

De­cem­ber’s in­fla­tion re­sults were in line with ex­pec­ta­tions. –

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