By Christopher S. Rugaber
WASHINGTON: Cheaper energy kept consumer prices in check in February, despite a big rise in the cost of food, the latest sign that inflation is tame.
The consumer price index rose 0.1 percent in February, matching January’s increase, the Labor Department said Tuesday.
In the past 12 months, prices have risen just 1.1 percent, down from 1.6 percent in January and the smallest yearly gain in five months.
Excluding the volatile food and energy categories, core prices rose 0.1 percent last month and 1.6 percent in the past year.
“There isn’t much in this report to suggest inflation is about to make a move to the upside or downside,” said Michael Feroli, an economist at JPMorgan Chase. He added that the measure called core inflation has been below the Federal Reserve’s 2 percent target for the past year.
Energy prices fell 0.5 percent because lower gasoline and electricity costs offset higher prices for natural gas and heating oil. Clothes and used cars were also cheaper last month.
Still, consumers took a hit at the grocery store as food costs rose 0.4 percent, the most in nearly 2½ years.
Beef prices jumped 4 percent in February, the most in more than 10 years, as recent droughts have pushed up cattle feed prices. Milk, cheese and other dairy prices also rose.
The drop in the annual inflation rate to 1.1 percent was announced Tuesday as the Federal Reserve began a two-day policy meeting, its first under new leader Janet Yellen.