US consumer prices steady in June

Dhaka,  Thu,  24 August 2017
Published : 15 Jul 2017, 11:49:02

US consumer prices steady in June; retail sales fall 

US consumer prices steady in June
US consumer prices were unchanged in June and retail sales fell for a second straight month as the low prices are hurting retailers, data showed on Friday.

The report from the Commerce Department showed pointing to tame inflation and soft domestic demand that diminished prospects of a third interest rate increase from the Federal Reserve this year.

Still, the economy likely regained speed in the second quarter after a sluggish performance at the start of the year. 

Industrial production picked up in June, driven by a surge in oil and gas drilling, the report showed.

The Labour Department said the unchanged reading in its Consumer Price Index came as the cost of gasoline and mobile phone services declined further. 

The CPI dropped 0.1 per cent in May and the lack of a rebound in June could trouble Fed officials who have largely viewed the recent moderation in price pressures as transitory.

In the 12 months through June, the CPI increased 1.6 per cent - the smallest gain since October 2016 - after rising 1.9 per cent in May. 

The year-on-year CPI has been retreating since February, when it hit 2.7 per cent, which was the biggest increase in five years.

The so-called core CPI, which strips out food and energy costs, edged up 0.1 per cent in June, rising by the same margin for three straight months. 

The core CPI increased 1.7 per cent year-on-year after a similar gain in May.

The Fed has a 2 .0 per cent inflation target and tracks a measure which is currently at 1.4 per cent.

In June, gasoline prices fell 2.8 per cent, decreasing for a second straight month. 

Food prices were unchanged after rising for five consecutive months. The cost of cellular phone services fell 0.8 per cent, extending their decline amid price competition among service providers.

Second report from the Commerce Department showed retail sales fell 0.2 per cent last month, weighed down by declines in receipts at service stations, clothing stores and supermarkets, reports Reuters.
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