Consumer Prices Slow Advance From January --- February's Increase of 0.5% Is More Modest, but Still Disturbs Some Analysts
WASHINGTON -- Consumer prices rose 0.5% last month, the Labor Department reported, a marked slowdown from their 1.1% surge in January but still disturbingly high to a number of economists.</br></br>A record 18.7% drop in fuel-oil prices helped hold down the overall price level, but a sharp, 3.3% jump in clothing prices kept inflation higher than many analysts had hoped.</br></br>The department's latest consumer price index, which measures the average change in the retail price of a fixed basket of goods and services, shows that the inflation rate seems to be recovering from a bitter cold-weather shock this winter. In January, catapulting food and energy prices drove the index up 1.1%, its largest monthly increase in more than seven years. The record drop in heating oil prices last month followed a 26.3% jump in January. Overall energy prices fell 0.7% in February after jumping 5.1% in January. Food prices, which soared 1.8% in January after the cold wave destroyed crops, grew 0.5% in February.</br></br>Many economists said that despite the retreat from January's sharp advance, February still leaves inflation worrisomely high.</br></br>"I think this shows inflation is a very stubborn problem," said Norman Robertson, chief economist at Mellon Bank in Pittsburgh. "There is simply no evidence as yet that the Federal Reserve has been able to bring down the core rate of inflation."