January Inflation, Price Increases Add Stress to the U.S. Economy
- Feb 20, 2008
Washington, D.C.–The U.S. inflation level hit its highest point since 2006 in January, highlighting the Federal Reserve’s challenge to balance inflation and economic growth, the Financial Times reports.Inflation rose because of higher clothing, medical and educational costs. After growing by 0.2 percent in every month since March of last year, the core consumer price index–which does not include prices for volatile energy and food–increased 0.3 percent last month, the Labor Bureau said.The CPI, when factoring in energy costs and an 0.7 percent increase in food costs, increased by 0.4 percent for the second consecutive month.Stocks fell into negative zones in early trading after the inflation news. Negative housing news released Wednesday–indicating the housing decline is still going strong–added more concern about the economy. Building permits–considered an indicator of future activity–were at their lowest point in 17 years.