18 July 2007, 17:27  US June CPI up 0.2 pct

Falling energy prices pushed consumer inflation down to its smallest monthly increase in almost half a year, while core inflation, which does not include volatile food and energy prices, continued to rise modestly, the Labor Department said today. Overall prices rose 0.2 pct, slightly faster than the 0.1 pct increase economists had expected but still the slowest pace since January. Core prices rose 0.2 pct in June, in line with expectations. Core inflation rose 0.1 pct in May and 0.2 pct April. That leaves the three months through June at a 2.3 pct seasonally adjusted annualized rate for core inflation, up sharply from the 1.6 pct through May and 1.9 pct through April. Overall inflation has risen at a 5.2 pct seasonally adjusted annualized pace over the past three months. Core inflation has risen an unadjusted 2.2 pct in the past twelve months, the same pace as the year through May. Overall inflation has risen an unadjusted 2.7 pct in the year through June. The latest snapshot of inflation comes just hours before Federal Reserve Board Chairman Ben Bernanke is scheduled to present his outlook for the US economy on Capitol Hill, where lawmakers are expected to question him about the Fed's view of inflation. Energy prices fell 0.5 pct in June after rising 5.4 pct in May, 2.4 pct in April, and 5.9 pct in March. Energy prices have risen at a 32.9 pct annual rate over the past three months, down from 71.0 pct annual rate in the three months ending May. Food prices rose 0.5 pct in June after rising 0.3 pct in May and 0.4 pct in April. Transportation prices fell 0.2 pct, while apparel prices fell 0.6 pct. Housing prices rose 0.3 pct and medical prices rose 0.2 pct in June. Real average weekly earnings, which are adjusted for inflation, rose 0.5 pct in June, while average hourly earnings, which are not adjusted for inflation, rose 0.3 pct in the month.

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