U.S. consumer prices barely increased in November as energy prices saw their smallest rise in five months, showing that inflation remains tame.
The seasonally adjusted consumer price index last month increased by 0.1% from October, the Labor Department said Wednesday, the fifth consecutive rise.
So-called core inflation, which excludes energy and food prices and is closely watched by the Federal Reserve, inched ahead by 0.1%, the first move after three flat months.
Economists surveyed by Dow Jones Newswires ahead of the release expected consumer prices to rise by 0.2% and core CPI to gain 0.1%.
The Fed considers core inflation a better measure of price trends because it excludes the most volatile components of the index.
The annual underlying inflation rate was 0.8%, well below the Fed's informal inflation target of between 1.7% and 2%. The Fed's policy-making committee Tuesday signaled that it thinks core inflation remains too low--a key factor in last month's decision to start buying $600 billion in Treasury bonds in an effort to boost investment and consumption.
Still, people tend to notice price changes on the things they buy frequently, such as gasoline and food.
Looking at the monthly changes, energy prices rose 0.2% in November, the smallest gain in five months as gasoline prices rose 0.7% last month after increasing by 4.6% in October. Household energy prices declined.
Food prices increased by 0.2%, led by gains for eggs and non-alcoholic beverages.
In other categories, prices for airline fares, shelter and apparel rose, but new and used vehicles, and household furnishings fell.
Without rounding, Wednesday's report showed that consumer prices rose by 0.122% in November. Excluding food and energy items, consumer prices increased 0.098%.
In a separate report, the Labor Department said real average weekly earnings fell by 0.1% in November, as the average work week was unchanged and prices rose.
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SOURCE: WSJ
