US consumer prices grew in April 2016, bolstered by soaring gasoline and rentals. The country’s inflation accelerated to 0.4% mom in April after in March was 0.1%. On an annual basis, consumer prices in USA grew by 1.1% against an increase of 0.9% in March. The core inflation, which excludes volatile prices of energy and food products, accelerated from 0.1% in March to 0.2% in April on a month-on-month basis. Compared to the same month last year, the core inflation slowed from 2.2% to 2.1%.
Acceleration of the broad gauge in April is likely to be welcomed by the US Federal Reserve, which inflation target is 2%. The financial markets do not expect Fed to raise interest rates again before September, given the weak economic growth in the first quarter. The US central bank raised its key interest rate from its historically low levels in December and the members of the Committee on monetary policy this year expect to have double tightening of monetary policy.
Another data for April showed that economic growth is gaining momentum early in the second quarter. The retail sales in USA recorded an increase of 1.3% on a monthly basis, but slower growth in employment and increase in the requests for unemployment sparked doubts about the state of the labor market.
In April, gasoline prices jumped by 8.1% compared to the previous month, the sharpest rise since August 2012. The food products rose 0.2% after March fell by 0.2%.
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