U.S. Inflation Rises at 2.1% Annual Rate, Consumer Prices Flat in February

The American cost of living climbed from a year ago due to higher energy bills, but those same energy costs fell in February to help keep consumer prices in check for the month, the Labor Department reported Thursday.

The Consumer Price Index (CPI), which is the government’s most closely watched barometer for measuring inflation at the consumer level, was flat in February, breaking away from five straight months of 0.2% increases. The month marks the first time since March 2009 when consumer prices did not climb, indicating tame inflation and reinforcing the Fed’s recent statement saying that inflation would remain subdued for "some time."

"Inflation is certainly no imminent threat to the U.S. economy," David Resler, chief economist at Nomura Securities International Inc. in New York, said on Bloomberg. Resler forecasted that prices would remain unchanged "It ties in with the Fed’s statement," he added.

The energy pricing index fell 0.5% in February after rising 2.8% during the prior month. Food prices rose a modest 0.1%. Continue reading U.S. Inflation Rises at 2.1% Annual Rate, Consumer Prices Flat in February

2010 Inflation Rates, Data and Calculator Updates

The cost of living for Americans remained unchanged in February as falling energy prices offset other price increases, the Labor Department reported Thursday.

While consumer prices were flat in February, the annual inflation rate climbed 2.1%, according to the Consumer Price Index, or CPI data. The CPI is the government’s key inflation barometer, measuring inflation at the consumer level.

By comparison, prices advanced 0.2% back in January — for the fifth straight time, and 12-month inflation ending for the month was at 2.6%. Continue reading 2010 Inflation Rates, Data and Calculator Updates

US Producer Prices Decline 0.6% in February, 12-Month Wholesale Inflation Rises 4.4%

US producer prices declined more than expected in February, according to the latest figures provided in a government report released Wednesday.

The Labor Department’s Producer Price Index (PPI) dropped 0.6 in February — the biggest fall since July, and after soaring 1.4% in January. The PPI measures inflationary pressures before they reach the consumer or, more technically, the wholesale price of goods leaving the factory gate. Many analysts were forecasting a monthly decrease ranging from 0.2% to 0.3%.

"Disinflation is going to be with us for a while," Julia Coronado, a senior U.S. economist at BNP Paribas in New York, said in a Bloomberg Radio interview. "That’s going to allow the Fed to stay on hold for a lot longer than the market is expecting."

Deflation is a persistent decrease in general prices, or the opposite of inflation. Falling prices may seem like good news for consumers, but only to a certain point. If prices mark sustained deflationary levels that strike below the cost to produce goods and services, further economic turmoil can ensue with production cuts, payroll reductions and deepening unemployment. Continue reading US Producer Prices Decline 0.6% in February, 12-Month Wholesale Inflation Rises 4.4%