Consumer Price Index in U.S. Was Unchanged, Core Up 0.2%

The cost of living in the U.S. was little changed in June, a sign inflation may stay subdued as Federal Reserve officials have predicted. No change in the consumer-price index followed a 0.3 percent drop in May, a Labor Department report showed today in Washington. The measure matched the median forecast of economists in a Bloomberg News survey. The so-called core measure that excludes volatile food and fuel costs rose 0.2 percent for a fourth month. Companies from Supervalu Inc. (SVU) to Chrysler Group LLC are offering incentives to boost sales as weak job gains squeeze households, underscoring limited pricing power among businesses. With inflation less of a concern, Fed policy makers have room to take additional steps to ensure the world’s largest economy keeps expanding. “Inflation is not a concern at this time,” said Ryan Sweet, a senior economist at Moody’s Analytics Inc. in West Chester, Pennsylvania, who was among economists projecting no change in June consumer prices. “The central bank is more worried about growth. Policy makers have signaled they may lean toward more easing.” The CPI was restrained by a third month of declines in energy prices. Airfares fell, used car prices were unchanged and the cost of shelter posted its smallest gain since September. The forecast for consumer prices was based on the median of 81 economists in a Bloomberg survey. Economists’ estimates ranged from a gain of 0.2 percent to a decline of 0.6 percent.