Page 7 - ATD20Febr2016
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U.S. NEWS A7
Saturday 20 February 2016
US Financial Front:
American consumer prices show signs of acceleration in January
Shoppers walk along Lincoln Road Mall, a pedestrian area fea- a year ago. Medical servic- are increasingly unsure Wednesday.
turing retail shops and restaurants in Miami Beach, Fla. On Fri- es are up 3.3 percent. about the path of inflation The officials said these
day, Feb. 19, 2016, the Labor Department reported on consumer In January, prices also rose after raising a key interest global pressures made it
prices for January. on a monthly basis for air- rate in December from a harder to forecast growth
fare, clothing and autos, record low set in late 2008. and inflation, two key fac-
(AP Photo/Lynne Sladky) while food expenses were The quarter-point increase tors for deciding the pace
flat. pushed the federal funds of additional rate hikes.
The Fed is closely following rate from near zero to a “Most participants indicat-
inflation, looking for assur- range of 0.25 percent to ed that it was difficult to
ance that it will accelerate 0.5 percent. judge at this point wheth-
to 2 percent in its preferred Top Fed policymakers have er the outlook for inflation
measure. That particular greater concerns about and economic growth had
measure of personal con- threats to U.S. economic changed materially, but
sumption places less of an growth coming from low- they thought that uncer-
emphasis on housing. It er oil prices and slowing tainty surrounding the out-
posted a modest annual growth in China and other look had increased as a re-
increase of 0.6 percent in emerging markets, accord- sult of recent financial and
December. ing to the minutes of their economic developments,”
Fed officials have said they January meeting released the minutes said.q
JOSH BOAK that inflation might barely
AP Economics Writer budge amid a slowing
WASHINGTON (AP) — U.S. global economy.
consumer prices were un- Jennifer Lee, a senior econ-
changed in January, as the omist at BMO Capital Mar-
rising costs of housing and kets, said that January’s
health care were largely report on consumer prices
offset by cheaper oil. affirms the Fed’s decision
But the annual pace of and raises the potential for
inflation showed signs of further rate increases later
acceleration. The Labor this year.
Department said Friday “In a way, this justifies the
that prices have risen 1.4 December rate hike and
percent over the past 12 keeps the Fed at the rate
months, compared to a hike table,” she said.
year ago when annual in- The combination of a
flation was close to zero. strong dollar and cheaper
Consumer prices climbed oil has suppressed inflation
at the fastest annual rate across much of the econo-
since October 2014. my. Gasoline prices at the
Core inflation, which ex- pump have dropped 24
cludes volatile energy and percent over the past year
food costs, rose 0.3 per- to a national average of
cent in January. Over the $1.72 a gallon. At the same
past 12 months, this cat- time, economic growth
egory closely watched by struggles worldwide have
the Federal Reserve has pushed up the value of the
climbed 2.2 percent. dollar, making foreign im-
The rising tempo for infla- ports cheaper. But the rate
tion follows a Fed decision of gasoline prices declining
in December to raise a key slowed in January, weak-
short-term interest rate for ening its downward pull on
the first time in nearly a de- inflation.
cade. But the turmoil in the Housing expenses — which
stock and bond markets account for a third of the
after the Fed rate hike sug- consumer price index—
gested to many investors have risen 3.2 percent from
