Partly reflecting a jump in energy prices, the Labor Department released a report on Wednesday showing consumer prices in the U.S. increased in line with economist estimates in the month of October.
The Labor Department said its consumer price index rose by 0.3 percent in October after inching up by 0.1 percent in September. Economists had expected prices to climb by 0.3 percent.
Over one-third of the increase in consumer prices was due to a spike in gasoline prices, which soared by 3.0 percent in October after dipping by 0.2 percent in September.
Prices for electricity also surged up by 2.3 percent, contributing to a 2.4 percent jump in energy prices in October following a 0.5 percent drop in the previous month.
Excluding the significant rebound in energy prices as well as a modest drop in food prices, core consumer prices edged up by 0.2 percent in October after creeping up by 0.1 percent in September. The uptick in core prices also matched expectations.
The modest increase in core consumer prices was partly due to notable growth in prices for shelter and used cars and trucks
Prices for medical care, household furnishings and operations, motor vehicle insurance, and tobacco also rose, while prices for communication, new vehicles, and recreation declined.
While the report also said the annual rate of consumer price growth accelerated to 2.5 percent in October from 2.3 percent in September, the annual rate of core consumer price growth slowed to 2.1 percent from 2.2 percent.
"The rebound in CPI inflation to 2.5% in October, from 2.3%, was mostly driven by a rise in gasoline prices which will be more than reversed over the next couple of months," said Andrew Hunter, U.S. Economist at Capital Economics.
He added, "The rest of the report supports our view that underlying inflation is unlikely to rise much further from here."
Last Friday, the Labor Department released a separate report showing a much bigger than expected increase in producer prices in the month of October.
The Labor Department said its producer price index for final demand climbed by 0.6 percent in October after rising by 0.2 percent in September. Economists had been expecting another 0.2 percent uptick.
Excluding food and energy prices, core producer prices still rose by 0.5 percent in October after edging up by 0.2 percent in September. Core prices had been expected to rise by another 0.2 percent.
Compared to the same month a year ago, producer prices in October were up by 2.9 percent, reflecting an acceleration from the 2.6 percent increase in September.
The annual rate of growth in core consumer prices also accelerated modestly to 2.6 percent in October from 2.5 percent in September.
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