By Christopher S. Rugaber
WASHINGTON: U.S consumer prices barely rose last month, the latest sign that slow economic growth is keeping inflation tame.
The Labor Department says the consumer price index increased just 0.1 percent in August, after a 0.2 percent increase in July. Excluding volatile food and energy costs, core prices also rose just 0.1 percent.
In the past 12 months, prices have risen 1.5 percent. That’s down from 2 percent year-over-year gain in July and below the Federal Reserve’s 2 percent inflation target. Core prices are 1.8 percent higher than a year ago, the largest 12-month gain since March.
The increase in core prices could help persuade the Fed to start pulling back on its low interest rate policies. But significantly low inflation would pressure the Fed to keep stimulating the economy.