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| Fuel costs push US prices higher | Fuel costs push US prices higher |
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| US consumer prices rose at their fastest pace in June for nearly a year, prompted by higher petrol prices, the Commerce Department has said. | US consumer prices rose at their fastest pace in June for nearly a year, prompted by higher petrol prices, the Commerce Department has said. |
| The Consumer Price Index rose 0.7% last month, after May's rise of 0.1%. The figure was slightly above the 0.6% increase analysts had expected. | The Consumer Price Index rose 0.7% last month, after May's rise of 0.1%. The figure was slightly above the 0.6% increase analysts had expected. |
| But the rise is viewed as a blip, as petrol prices rose 17.5% last month. | But the rise is viewed as a blip, as petrol prices rose 17.5% last month. |
| However, the index was down 1.4% from the same period a year earlier when energy costs were higher. | However, the index was down 1.4% from the same period a year earlier when energy costs were higher. |
| This is the largest year-on-year decline in nearly six decades. | This is the largest year-on-year decline in nearly six decades. |
| Oil volatility | |
| Energy prices have fallen considerably since last year, but have shown significant volatility in recent weeks. | Energy prices have fallen considerably since last year, but have shown significant volatility in recent weeks. |
| Inflation has neither gone away nor become a problem Joel Naroff, Naroff Economic Advisors | |
| In July last year, oil prices reached a record high of above $147 a barrel, but by the end of 2008 prices were below $40 a barrel. In recent weeks oil has been trading at about $60. | In July last year, oil prices reached a record high of above $147 a barrel, but by the end of 2008 prices were below $40 a barrel. In recent weeks oil has been trading at about $60. |
| Core consumer inflation - which excludes volatile energy and food prices - rose 0.2% in June - just above forecasts of 0.1%. Year-on-year the rise was 1.7%. | Core consumer inflation - which excludes volatile energy and food prices - rose 0.2% in June - just above forecasts of 0.1%. Year-on-year the rise was 1.7%. |
| "Inflation has neither gone away nor become a problem," said Joel Naroff of Naroff Economic Advisors. | |
| "Investors should like this report as it basically says the Fed is free to do what it has to in order to get the economy going faster." | |
| Separate figures released on Wednesday showed that while US industrial production continued to fall in June, the rate of decline slowed. | |
| Production fell 0.4% last month, following May's revised 1.2% decline, said the Federal Reserve. |