Consumer Prices Up 0.3% in January

But inflation over past 12 months lowest in a half-century

By the Associated Press

Posted Feb 20, 2009 9:07 AM CST

(AP) – Consumer prices rose by 0.3% last month, the Labor Department said today, the biggest monthly increase since a 0.7% rise in July. Higher energy costs fueled the climb, and most economists and the government believe the recession will keep prices in check this year. That's because inflation has been flat over the past year, the lowest reading in more than a half-century.

Even with the January increase, which was in line with economists' expectations, inflation for the 12 months ending in January was zero. That's the lowest reading since prices actually fell by 0.4% for a 12-month period ending in August 1955. While falling prices appeal to consumers, the Federal Reserve is on alert about the possibility of deflation, which can make a recession even worse by dragging down Americans' wages, and clobbering already-stricken home and stock prices.

Consumer prices rose by the most in six months in January, propelled by higher energy costs. (AP Photo/The Blade, Lisa Dutton)

Consumer prices rose .3% last month. (AP Photo/Ted S. Warren)

Inflation has been flat over the past 12 months. (AP Photo/Lisa Poole)

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Consumer Prices Up 0.3% in January

But inflation over past 12 months lowest in a half-century

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Wholesale Prices Rising at Fastest Pace Since 1981

High energy, motor vehicle costs pushing inflation; Fed may be forced to boost rates

Consumer Prices Flat in Feb.

Lack of increase means Fed has an open door to a big rate cute next week

Consumer Spending Up... Thanks to Gas Prices

Personal income up 0.3%, but inflation hits hard

US Economy Needs Less Caution, More Spending

Forget deficit; fret over threat of 'lost decade'

America's 40% Overpriced

Take in some discount movies, you'll understand

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Consumer Prices Up 0.3% in January

But inflation over past 12 months lowest in a half-century

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OTHER STORIES ON OUR RADAR

inflation • consumer prices • economy

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Wholesale Prices Rising at Fastest Pace Since 1981

High energy, motor vehicle costs pushing inflation; Fed may be forced to boost rates

Consumer Prices Flat in Feb.

Lack of increase means Fed has an open door to a big rate cute next week

Consumer Spending Up... Thanks to Gas Prices

Personal income up 0.3%, but inflation hits hard

US Economy Needs Less Caution, More Spending

Forget deficit; fret over threat of 'lost decade'

America's 40% Overpriced

Take in some discount movies, you'll understand

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