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Key US Inflation Gauge Jumps


The most closely watched gauge of inflation in the United States has registered its biggest surge in five months.

A Labor Department report says the Consumer Price Index jumped six-tenths of one percent in March, as the costs of energy, clothing and airline fares all rose sharply.

Analysts say the more worrisome number is that the so-called core rate of inflation, which takes out volatile food and energy costs, jumped four-tenths of one percent in March. That is double what had been expected.

The new report could re-ignite debate on Wall Street and among federal regulators about whether inflation is accelerating.

U.S. stocks rallied on Tuesday after a tame report on producer prices, but traders said the rally lacked depth or enthusiasm.

Some information for this report provided by AP, Reuters.

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