Consumer prices up slightly
Rising food, energy costs are main driver
WASHINGTON – Rising gasoline prices pushed inflation up modestly in June.
The Labor Department says its consumer price index rose 0.3 percent last month. Prices at the pump rose 3.4 percent in June on top of a 10.4 percent increase in May. An outbreak of avian flu drove egg prices up 18.3 percent in June, but overall food prices rose just 0.3 percent. Excluding volatile food and energy prices, so-called core inflation rose 0.2 percent last month.
The June numbers were about what economists had expected.
Overall consumer prices rose just 0.1 percent the past year; core prices are up 1.8 percent. Gasoline prices are down 23.3 percent over the last year; they hit bottom in January, then rebounded.
Federal Reserve policymakers are watching inflation as they decide when to increase the central bank’s benchmark short-term interest rate.
The Fed wants annual inflation of 2 percent, though it uses a different measure, based on personal consumption spending.
Inflation is running below the Fed’s 2 percent target. But Fed chair Janet Yellen told Congress this week that the central bank is likely to lift short-term interest rates later this year. The Fed has kept the rate it controls near zero for more than six years, first to calm financial markets after the panic of 2008 and then to bolster a weak recovery from the Great Recession of 2007-09. But the U.S. economy has shown steady improvement. Employers are adding a healthy 208,000 jobs a month so far this year.