US consumer prices rise in February for first time in four months

US consumer prices rebounded in February, as gasoline price climbed for the first time in June, the Labor Department said.

According to figures released on Tuesday, Consumer Price Index (CPI) rose for the first time in four months February, climbing 0.2% after declining 0.7% in January.

The CPI was unchanged in the 12 months to February, after falling 0.1% in January.

Analysts had expected a 0.2% increase month-on-month and a 0.1% decline year-on-year.

Gasoline prices rebounded by 2.4% month-on-month in February, while food prices increased 0.1% compared to the previous month.

Excluding food and energy, core consumer prices increased by a moderate 0.2% month-on-month, pushing the annual core inflation rate up to 1.7%, from 1.6%.

“In the near-term, the stronger dollar will continue to put downward pressure on imported goods prices,” said Capital Economics’ chief US economist Paul Ashworth.

“But going in the other direction, rising labour costs will put upward pressure on core services prices.”

Ashworth added that inflation is expected to gradually strengthen in the second half of the year, as the dampening effect from the stronger dollar fades.

“By the first half of 2016, we anticipate that it will climb back to the Fed's 2% target, prompting a more aggressive monetary tightening that either Fed officials or the markets currently expect,” he said.