US inflation tamed just a bit in March and over the past twelve months as energy prices increased at a slower pace last month, the US government reported Friday in Washington. Still, the costs of food and most other goods and services went up last month to add further distress to the pocketbooks of many Americans.
Consumer prices advanced 0.3 percent in March after increasing of 0.4 percent in the previous month, US Labor Department inflation data revealed. Increases were again led by energy, followed by food.
Prices at the pump grew 1.7% last month, although that was significantly slower than the prior month’s 6.0 percent surge which had been the main driver to the biggest monthly increase in consumer prices since April 2011.
"Inflation is under control, and if we’re near the top in gas prices, even the energy inflation could go the other way," USA TODAY quoted Stuart Hoffman, chief economist of Pittsburgh-based PNC Financial, who had accurately predicted consumer prices would rise 0.3 percent. "There are still a lot of unemployed people, a lot of unused productive capacity, and wage gains are low. The runup in commodity prices, or wage gains that cause inflation, none of it is there."
There were gains in other areas, however. In February the cost of food was flat, marking the first time prices had not moved higher since July 2010. But that was not the case in March as food prices went up 0.2 percent.
Stripping out the more volatile food and energy costs, the so-called core US inflation rate rose 0.2 percent in March after increasing 0.1 percent in the prior month. Many of the government tracked core items saw higher prices as well.
"Most of the major components increased in March, with the indexes for shelter and used cars and trucks accounting for about half the total increase for all items less food and energy," the US Labor Department said in its monthly Consumer Price Index (CPI) report which is the government’s key measure of US inflation.
‘The indexes for medical care, apparel, recreation, new vehicles, and airline fares increased as well, while the indexes for tobacco and household furnishings and operations were among the few to decline in March."
US inflation rose 2.7 percent on a year-over-year basis after advancing 2.9 percent in February. The 12-month rate was at 3.9 percent as recently as September.
The core US inflation rate rose 2.3 percent annually following an increase of 2.2 percent in February. The level remains higher than the Fed’s 2.0 percent target, although that is seen as temporary and it is not the main area of the Federal Reserve’s current focus.
"Inflation is going to be slowly decelerating as the energy price impulse that we’ve seen starts to fade," Bloomberg quoted Michael Carey, the chief economist for North America at Credit Agricole CIB in New York, who correctly forecasted the rise in prices. "The Fed is in wait and see mode. Inflation is not driving policy. They are more concerned about economic growth and the labor market."
The following table provides US Labor Department inflation data ranging from September to March and on a 12-month basis.
March 2012 Consumer Prices – Gains (percent)
|Food at home||0.6||0.1||-0.1||0.3||.0||.0||0.1||3.6|
|Food away from home||0.2||0.2||0.3||0.2||0.4||0.1||0.2||3.0|
|Gasoline (all types)||2.9||-3.1||-2.4||-2.0||0.9||6.0||1.7||9.0|
|Utility (piped) gas service||0.8||-3.0||-4.4||-0.8||-2.9||-3.4||0.9||-9.1|
|All items less food, energy||0.1||0.1||0.2||0.1||0.2||0.1||0.2||2.3|
|Comm. less food, energy||-0.2||-0.1||0.1||-0.2||0.2||0.1||0.2||2.1|
|Used cars and trucks||-0.6||-0.6||-0.1||-0.9||-1.0||-0.2||1.3||3.2|
|Services less energy||0.2||0.2||0.2||0.3||0.2||0.1||0.2||2.3|
The US Labor Department will release April 2012 Consumer Price Index information on May 15, 2012 at 8:30 AM Eastern Time. Current and historic CPI data is used as the core data for the US Inflation Calculator.