The Consumer Price Index rose by .6 percent within the month of April and 3.8 percent annually from a year ago through April, according to the monthly report issued yesterday by the Bureau of Labor Statistics.
Energy fueled the price increase. Fuel oil spiked 54 percent and gasoline jumped 28 percent over the year. Medical care commodities and used cars and trucks ranked as the only two items of the 20 listed to show price decreases.
This report essentially forced the hand of the Federal Reserve, which specifies two percent as its target rate of inflation. The Fed may stand pat, given non-monetary factors, i.e., fossil fuels, bearing the primary responsibility for the hike in prices. It may eventually raise the federal funds rate.
It seems unlikely that we will see another round of rate cuts anytime soon.
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