Gas Costs Fuel Rise In Consumer Prices

Sluggish sales and a modest rise in inflation last month provide fresh evidence of an economic slowdown that analysts say could lead the Federal Reserve to lower interest rates this summer.

Consumer costs increased 0.3 percent in May, led by the biggest jump in gasoline prices in nine months, the Labor Department said Tuesday.

The Commerce Department reported that retail sales, after slipping 0.3 percent in April, were up a mere 0.2 percent last month.

“It’s an economy that’s struggling to retain its strength, not an economy that’s struggling to restrain inflation,” said economist Robert Dederick of the Northern Trust Co. in Chicago.