Gas Prices Fed Consumer Price Increase in March

WASHINGTON (Los Angeles Times/TNS) -

Consumer prices rose in March for the second straight month, as gas prices continued to rebound after their steep drop.

The consumer price index increased 0.2 percent, the same as in February, the Labor Department said Friday. February’s increase was the first in four months as a sharp drop in crude-oil prices pushed down energy costs across the board.

Last month’s increase was in line with analysts’ forecasts and an indication that inflation is stabilizing.

Gasoline prices increased 3.9 percent in March, and energy prices more broadly were up 1.1 percent. That offset a 0.5 percent decline in grocery prices, the biggest drop since April 2009.

Annual inflation remained extremely low, with prices down 0.1 percent for the 12 months ended March 30.

During that period, energy prices were down 18.3 percent, more than offsetting a 2.3 percent increase in food prices.

But food and energy prices are very volatile. So-called core inflation, which excludes those, was up 1.8 percent for the year after a 0.2 percent increase in March.

Federal Reserve officials want to see all prices rising about 2 percent a year, and concerns over low inflation are weighing on central-bank policymakers as they consider when to start raising their benchmark short-term interest rate.

The Fed uses a different inflation barometer based on personal consumption expenditures, but that figure also is low: up just 0.3 percent for the year ended Feb. 28, the most recent data available.