US consumer prices increased 0.4% in February in line with market expectations, the Labor Department said on Wednesday.

The Consumer Price Index (CPI), which measures changes in the price of goods and services from a consumer perspective, rose 0.3% in January.
On an annual basis, CPI was up 1.7% in February from the same month in 2020, again in line with market consensus.

“The gasoline index continued to increase, rising 6.4% in February and accounting for over half of the seasonally adjusted increase in the all items index,” the agency said in a statement.

“The electricity and natural gas indexes also increased, and the energy index rose 3.9% over the month,” it added.

Core consumer prices, which exclude food and energy, rose just 0.1% but are up 1.3% year-over-year.

The Federal Reserve closely watches inflation figures in the world’s largest economy hit hard by the coronavirus pandemic.

The central bank has repeatedly said recently that it may allow inflation to climb above its target of 2% for some time until the economy fully recovers and before it increases interest rates.

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