U.S. consumer prices increased in February as gasoline prices rose for the first time since June, a sign of inflation pressures and a future interest rate hike in June.
The Labor Department said Tuesday the Consumer Price Index (CPI) increased 0.2 percent last month after declining 0.7 percent in January, marking the end to three straight months of declines. In the 12 months through February, the CPI was flat after falling 0.1 percent in January.
Economists polled by Reuters had expected the CPI to rise 0.2 percent from January and slip 0.1 percent from a year ago.
Federal Reserve officials have held a 2 percent inflation target that has not been met, resulting in short-term interest rates remaining near zero since December 2008.
Fed Chair Janet Yellen said last week policymakers could raise interest rates when they had “seen further improvement in the labor market” and were “reasonably confident that inflation will move back to its 2 percent objective over the medium term.”
The so-called core CPI, which strips out food and energy costs, increased 0.2 percent in February, while during the 12 months through February the core CPI rose 1.7 percent, or the largest increase since November.
Last month, domestic gasoline prices rose 2.4 percent, which was the largest increase since December 2013, following a loss of 18.7 percent in January. Gasoline prices had declined for seven straight months.
Food prices increased 0.2 percent. Elsewhere, shelter costs increased 0.2 percent, which accounted for about two-thirds of the increase in the core CPI. Shelter costs had increased 0.3 percent in January.
Apparel prices rose 0.3 percent in February, as did airfares, new motor vehicle and used cars and trucks prices. Medical care services declined for the first time since 1975, though the data is expect to be an outlier.
