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The
Labor Department said on Thursday its Consumer Price Index rose
0.2 percent last month as gasoline price increases slowed and
food costs remained soft. The CPI advanced 0.4 percent in
October.
In the 12 months through November, the CPI increased 1.7
percent, the biggest year-on-year gain since October 2014. The
CPI rose 1.6 percent in the year to October.
Economists polled by Reuters had forecast the CPI rising 0.2
percent last month and climbing to 1.7 percent from a year ago.
The so-called core CPI, which strips out food and energy costs,
rose 0.2 percent last month after edging up 0.1 percent in
October. Rents accounted for most of the increase in the core
CPI last month. Despite the increase, the year-on-year increase
in the core CPI was unchanged at 2.1 percent.
The Fed on Wednesday raised its benchmark overnight interest
rate by 25 basis points to a range of 0.50 percent to 0.75
percent, in what Chair Janet Yellen said was "a vote of
confidence in the economy."
The U.S. central bank forecast three rate hikes in 2017 in
anticipation of U.S. President-elect Donald Trump's expansionary
fiscal policy agenda aimed at boosting growth through
infrastructure spending and tax cuts.
The Fed has a 2 percent inflation target and tracks an inflation
measure which is currently at 1.7 percent.
The central bank noted that inflation had increased since
"earlier this year" and expected it to rise to its target "over
the next couple of years." Trump's proposed fiscal policy would
come when the economy is at full employment and fans inflation.
Last month, gasoline prices rose 2.7 percent after jumping 7.0
percent in October. Food prices were unchanged for a fifth
straight month. Food consumed at home declined for a seventh
consecutive month.
Within the core CPI basket, housing continued its upward march
in November. Rents increased 0.3 percent last month, with
owners' equivalent rent of primary residence also gaining 0.3
percent after a similar rise in October.
The cost of medical care services rose 0.2 percent after being
unchanged for two straight months. The cost of doctor visits
increased 0.6 percent, while prices for prescription medicine
fell 0.6 percent. The cost of hospital services slipped 0.1
percent.
There were increases in the prices of a range of other goods
last month including used cars and trucks, which rose for the
first time since February. The cost of motor vehicle insurance
increased 1.0 percent.
((Reporting by Lucia Mutikani; Editing by Paul Simao))
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