Inflation remained under control in February, leaving the Federal Reserve greater leeway to cut its benchmark interest rates at the scheduled meeting of its Open Market Committee on Tuesday.
The Labor Department this morning reported that prices for goods in nearly all categories were under control in February, with the seasonally adjusted Consumer Price Index unchanged after a 0.4% increase in January. Each of the three groups--food, energy, and all items less food and energy--contributed to the deceleration, the Labor Department said. Wall Street was expecting an increase of 0.2%.
The index for energy turned down in February as a 1.9 percent decline in the index for energy commodities more than offset a 1.7 percent increase in the index for energy services. The February numbers did not reflect recent surges in the price of gasoline, however.
The index for food at home, which rose 0.9 percent in January, increased 0.3 percent, due to a decline in the indexes for fruits and vegetables, for meats, poultry, fish, and eggs, and for nonalcoholic beverages. The index for all items less food and energy was virtually unchanged after increasing0.3 percent in January, owing to smaller increases in the indexes for shelter, for medical care, for recreation, for education and communication, and for other goods and services, and a decline in the indexfor apparel.
Still, on a non-seasonally adjusted basis, the CPI for February was up 0.3% to 211.693 (1982-'84=100), 4% higher than the same month a year before. On the same basis, energy prices are up 18.9%, transportation prices are up 9% and food is up 4.6%.