Consumer prices in the U.S. saw a modest increase in the month of March, the Labor Department revealed in a report on Thursday, with the uptick in prices falling short of economist estimates.
The Labor Department said its consumer price index inched up by 0.1 percent in March after dipping by 0.2 percent in February. Economists had expected the index to rise by 0.2 percent.
The modest increase in consumer prices was partly due to a rebound in energy prices, which climbed by 0.9 percent in March after plummeting by 6.0 percent in February.
Gasoline prices surged up by 2.2 percent, while fuel oil prices jumped by 1.7 percent, marking the first increase since last May.
On the other hand, the report said food prices slipped by 0.2 percent in March after rising by 0.2 percent in February. Prices for fruits and vegetables showed a notable decrease.
Excluding food and energy prices, core consumer prices edged up by 0.1 percent in March, reflecting the smallest increase since last August.
After climbing by 0.3 percent in each of the two previous months, core prices had been expected to rise by 0.2 percent.
The uptick in core prices reflected higher prices for shelter, recreation, medical care, education, tobacco, and personal care.
Meanwhile, the report also showed a sharp pullback in apparel prices, which slumped by 1.1 percent in March after jumping by 1.6 percent in February.
Prices for airline fares, communication, household furnishings and operations, and used cars and trucks also declined.
On an annual basis, the pace of consumer price growth slowed to 0.9 percent in March from 1.0 in February, and the pace of core price growth edged down to 2.2 percent from 2.3 percent.
ING Chief International Economist Rob Carnell said tame inflation combined with some weaker activity data in recent weeks will make it difficult for the hawks on the Federal Reserve to make a persuasive case for an interest rate hike at the April meeting.
"Even flagging a possible June hike in the April meeting now seems like a stretch," Carnell said following the release of the data.
The Labor Department released a separate report on Wednesday showing an unexpected drop in producer prices in the month of March.
The report said producer prices edged down by 0.1 percent in March after slipping by 0.2 percent in February. The drop surprised economists, who had expected prices to climb by 0.3 percent.
Excluding food and energy prices, core producer prices still dipped by 0.1 percent in March after coming in unchanged in February. Core prices had been expected to rise by 0.2 percent.
Compared to the same month a year ago, producer prices were down by 0.1 percent in March after coming in unchanged in February.
The annual rate of core producer price growth also slowed to 1.0 percent in March from 1.2 percent in the previous month.
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