Washington, July 16--Consumer-price inflation moderated in June, supporting the Federal Reserve's assessment that the surge in prices recorded earlier this year probably was the result of temporary forces.
The consumer-price index rose 0.3% last month, half the rate recorded in May, the Labor Department said Friday. Moderating food and energy prices accounted for much of the slowdown. The closely watched core index, which excludes those items, was up 0.1%, the smallest increase this year.
Economists had expected increases of 0.2% in both the overall and core indexes, according to a survey by Dow Jones Newswires and CNBC had. Still, the numbers were broadly consistent with other measures of inflation in June, which have shown a slowdown in the growth of prices.
In annual terms, the core index inched up to a 1.9% rate from a 1.7% pace in the year through May. That's within the 1%-to-2% range that Fed policy makers have said is desirable.
Energy prices rose 2.6% after a 4.6% gain a month earlier; gasoline prices rose 3.1% after an 8.1% increase. Food prices rose 0.2% after a 0.9% gain, while the cost of dairy products, which had helped drive up overall food prices in May, rose 1.7% after a 6.8% increase a month earlier.
Housing prices also moderated, climbing 0.3% after a 0.4% gain. Transportation prices rose 0.8%, slightly less than half the rate recorded in May. Prices of new motors rose for a second consecutive month, growing 0.2% after a 0.1% gain. Medical-care prices rose 0.3%, the same rate as in May.
