CPI slightly higher in 2009

The Consumer Price Index, the government's key inflation reading, rose 2.7% during the past 12 months compared to 2008. Gasoline prices rose 53.5% over the last year while food prices decreased 0.5%, according to the report. The so-called core CPI, which is more closely watched by economists because it excludes volatile food and energy prices, was up 1.8% over the past year. Excess slack in both the industrial sector and the labor market are keeping inflation pressures muted. The Federal Reserve has promised to keep overnight lending rates near zero for an extended period of time. The Labor Department said its Consumer Price Index rose 0.1 percent last month, driven by a sharp rise in the index for used cars and trucks, after rising 0.4 percent in November. But the gain was smaller than the 0.2% rise Economists surveyed by Briefing.com had forecast. Manufacturing growth in New York State accelerated more rapidly than expected in January on surging new orders and shipmen
ts, and employment also improved, the New York Federal Reserve said on Friday. The survey of manufacturing plants in the state is one of the earliest monthly guideposts to U.S. factory conditions.