The Consumer Price Index increased a seasonally adjusted 0.3% for April for its largest gain in 10 months, according to a Labor Department report (link opens as PDF) released today. After increasing 0.2% for March, analysts' expectations of 0.3% proved spot-on for April. The index's boost came from increases in gasoline, shelter, and food components.
The gasoline index jumped 2.3% for its first increase since December, while food prices grew 0.4% for the third straight month. Food prices were driven by the largest increase in the cost of meat in 10 years. The cost of fruits, vegetables and dairy products also rose. A drought in California and an excessively cold winter in the Midwest have pushed up food prices this year.
The shelter index increased 0.2%. Rents increased 0.3%, and the prices of new and used cars rose. Air fares jumped 2.6% in April, the most in more than four years. The cost of clothes, furniture and haircuts were unchanged.
Excluding more volatile food and energy prices, the CPI still managed a 0.2% increase, same as in March.
Today's report comes hand in hand with a positive jobless claims release. Together, the two new data points hint at a stronger economy ahead, boosted by more employed persons willing to pay more for goods and services.
Over the last 12 months, the CPI has headed 2% higher, fueled by a 1.9% increase in food prices, a 2.8% increase in shelter prices, and a 3.3% increase in energy prices.
-- Material from The Associated Press was used in this report.