United States: Annual inflation continues to moderate
May 16, 2012
In April, consumer prices remained unchanged over the previous month in seasonally adjusted terms. The figure was below the 0.3% rise recorded in March, but in line market expectations. The reading mainly reflected how an increase in prices for food was entirely offset by lower energy prices, in particular for gasoline. As a result of the monthly figure, annual headline inflation fell from 2.7% in March to 2.3%, which marks its lowest level in over a year. Meanwhile, the closely monitored core inflation index, which excludes food and energy prices, added 0.2% over the previous month. As a result, annual core inflation inched up from 2.2% in March to 2.3% in April. Annual average inflation over the previous 12 months inched down to 3.2% from 3.3% in March. In its latest forecast, the Federal Reserve expects PCE inflation (based on the price index for personal consumption expenditures) to average between 1.9% and 2.0% this year. For 2013, the Fed anticipates PCE inflation to range between 1.6% and 2.0%.