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| June 14, 2008 | Saturday | Jamadi-us-Sani 09, 1429 |
3.1 million Americans face hunger
WASHINGTON, June 13: About 3.1 million residents of New York City, or about 40 per cent of the population, struggled to put food on the table in 2007, a new study out on Friday found.
The number of people hard hit by rising prices soared by 52 per cent since 2003, the first year the study by the New York Food Bank was done.
Half of all resident Hispanics and half of the population of the borough of the Bronx said they faced tough times buying food last year, the study found.
US consumer prices jumped by a more-than-expected 0.6 per cent in May, largely as energy costs soared, a government report showed on Friday.
Economists said they were not surprised that energy costs leapt higher, but said the report could cause some angst at the Federal Reserve as it suggests inflationary pressures are building.
Rising energy costs have already impacted the US economy. Americans are paying more for gasoline to fill their vehicles, airlines are slashing costs to offset spiking jet fuel bills, and automakers are enduring a sales slump for big sport utility vehicles.
“The news is not good but not surprising,” said Stephen Gallagher, an economist at Societe Generale.
“The Federal Reserve cannot be surprised by these figures but will be watchful to how these readings along with further gas and food prices influence inflation expectations,” Gallagher said.
Overall consumer prices showed their strongest spurt in May since November, while the core rate accelerated at its fastest clip since March, according to the monthly Labour Department survey.
Core consumer price inflation (CPI), which excludes volatile food and energy prices, gained 0.2 per cent during May.
Economists are watching moves in the core rate closely to see if rising energy costs are starting to spread to other sectors of the economy.
“Although core price inflation remained moderate, there will be concern in Fed quarters that the May uptick in the core rate is a harbinger of the pass-through of surging energy costs into consumer prices at large,” said Kenneth Beauchemin, an economist at Global Insight.
The rise in the core CPI reading matched most economists’ predictions.
Analysts had expected headline inflation to rise 0.5 per cent.
The gains come as world oil prices continue to hover near record highs.
Speculation has mounted in recent weeks that the Fed might be forced to start raising interest rates in a bid to ward off inflationary pressures.
Inflation picked up in May as energy costs rocketed 4.4 per cent, marking their strongest gain since November.Food prices rose a milder 0.3 per cent during the month, despite concerns about rising world commodity costs.
The report also revealed that transportation prices jumped 2.0 percent in May, also registering the biggest gain since November.—AFP
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