WASHINGTON -- Consumers paid more in January for everything from food and gas to airline tickets and clothing.
The price increases reflect creeping but modest inflation.
The Consumer Price Index rose 0.4 percent last month, matching December's increase, the Labor Department said Thursday.
During the past year, the index has risen 1.6 percent.
Core prices, which exclude volatile food and energy costs, rose 0.2 percent. That's the largest monthly increase in more than a year. Over the past 12 months, core prices have increased 1 percent. This is more than December's 0.8 percent annual pace, but it remains well below the Federal Reserve's comfort zone for inflation of between 1.5 percent and 2 percent.
Food prices climbed 0.5 percent in January, the most in more than two years. Still, food costs in the United States are tame compared with the raging inflation in many developing countries, which are more vulnerable to rises in the prices of corn, wheat, and other commodities.
Other reports Thursday showed:
- More people are applying for unemployment benefits. Applications rose last week to a seasonally adjusted 410,000, the Labor Department said. The increase follows a week when applications fell to their lowest level in nearly three years. But that decline was linked partly to snowstorms that closed some government offices and kept people from applying for benefits.
- A private research group's gauge of future economic activity rose a slight 0.1 percent in January, much less than in recent months. The rise in the Conference Board's index of economic indicators was the seventh straight monthly advance.
The report on consumer prices showed that some companies are trying to pass on higher prices for oil, cotton, and agricultural products. In January, a measure of wholesale inflation rose at the fastest pace in more than two years.
But high unemployment and weak wage increases are limiting the ability of many retailers to raise prices.
"With the unemployment rate still at 9 percent, there will be plenty of downward pressure on underlying prices, and so we don't expect core inflation to trend upward," said Paul Ashworth of Capital Economics.
Yet many food companies are raising prices in response to a jump in the cost of raw materials. Corn prices have doubled in the past six months. Prices for wheat and soybeans also have risen.
Global food prices have risen 29 percent in the past year, according to a World Bank report Tuesday. They are just 3 percent below the peak reached in 2008.
The impact has been much smaller in the United States. Americans spend a smaller proportion of their budgets on food -- about 14 percent, compared with 40 percent to 50 percent overseas.
Fed officials concluded late last month that inflation isn't yet a problem in the United States, according to minutes from their meeting. The central bank anticipates that inflation won't exceed 1.7 percent this year.
Still, many prices are starting to rise. The cost of clothing climbed 1 percent in January as companies offset the rising price of cotton.
Airline fares increased for the fifth month in a row, rising 2.2 percent. Airlines are paying about 50 percent more for fuel than they did a year ago. They have raised fares or fuel surcharges five times since December.
Gas prices rose 3.5 percent in January. The cost of housing rose 0.1 percent, reflecting increases in rents.
Some goods and services are getting cheaper. New and used car prices fell. Hotel prices dropped 1 percent. Technology equipment costs fell 0.8 percent.
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