WASHINGTON – Consumer prices rose in November by the smallest amount in three months as the climb in energy prices moderated a bit and food prices remained flat.
The Labor Department said Thursday that its consumer price index increased 0.2 percent last month after a 0.4 percent October increase.
Energy prices were up 1.2 percent, a slowdown from a 3.5 percent surge in November. The result reflects the fact that gasoline prices rose 2.5 percent last month, less than half the 6.7 percent October gain. Food prices showed no increase for a fifth straight month.
Over the past year, consumer prices are up 1.7 percent, still below the Federal Reserve’s 2 percent annual inflation target. But the Fed raised its benchmark interest rate Wednesday, noting that inflation has begun to rise from ultra-low levels.
Core inflation, which excludes volatile energy and food costs, was also up 0.2 percent in November. Core prices have risen 2.1 percent over the past year.
The Federal Reserve boosted its key interest rate by a quarter-point to a new range of 0.5 percent to 0.75 percent, the first rate increase since an initial quarter-point move a year ago. For seven years, the Fed kept its benchmark rate at a record low near zero as it sought to jump-start an economy that had been hit by the worst recession since the 1930s.
The Fed said in an updated set of forecasts that it foresaw the possibility of another three rate hikes in 2017. But Fed Chair Janet Yellen told reporters that the central bank still sees rate increases coming at a gradual pace given that inflation was expected to rise only moderately over the coming year.