US consumer prices up strongly

WASHINGTON - US consumer prices rose a surprisingly large 0.4 percent in February, with surging energy prices fuelling headline inflation, the government said Wednesday.
The core rate, which excludes volatile food and energy costs, rose 0.3 percent in the month, the Labor Department said.
The markets had been expecting the headline figure to go up 0.3 percent and the core rate to rise by 0.2 percent.
The figures came a day after the Federal Reserve shocked Wall Street with a tough warning on inflation as it raised interest rates by 25 basis points to 2.75 percent.
The consumer price index is now up 3.0 percent in the past year, while the core rate has risen 2.4 percent, the biggest gain since August 2002.

03/23/2005 13:40 GMT