WASHINGTON -- U.S. consumer prices were under wraps last month, a government report showed, especially when food and energy prices were stripped out, further evidence that the economic slowdown is easing some of the inflationary effect of recent sharp gains in food and energy prices.
Consumer prices rose 3.9% on a year-over-year basis, down slightly from the prior month (see chart above). The core CPI grew a more modest 2.3% compared to April 2007. Over the past three months, core inflation rose at only a 1.2% annual rate.
CPI inflation at an annual rate has fallen in each of the last four months, and is at the lowest rate in six months (since October 2007).