Underlying inflation pressures rose in November even as weakness in gasoline prices kept overall U.S. consumer prices in check, something experts say could give the Federal Reserve more motivation to raise interest rates on Wednesday.
The U.S. Labor Department's so-called core Consumer Price Index, which excludes food and energy, increased 0.2% last month. It was the third straight month that the core CPI increased by that 0.2% figure.
In the 12 months through November, the core CPI rose 2.0 percent, the largest gain since May 2014, after rising 1.9 percent in October.
Whatever increase in core CPI reflected steady gains in the cost of rents, airfares, new motor vehicles and medical care. Those figures were, however, offset by falling gasoline prices, leaving the overall CPI unchanged last month after the 0.2% increase in October.
In the 12 months through November, inflation increased 0.5%, the largest gain since last December, after rising 0.2% in October. The Fed targets 2% inflation and it tracks an index that is running far below the core CPI.
The report was released just hours before Fed officials were due to gather for a two-day meeting. The U.S. central bank is expected to lift its benchmark overnight interest rate from near zero at the end of the meeting on Wednesday, buoyed by tightening labour market conditions.
The Fed has not raised rates since June 2006.
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