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February Prices Up 0.3%; Gasoline, Meat Cheaper

March 24, 1985|United Press International

WASHINGTON — Consumer prices inched up another 0.3% in February, keeping the inflation rate in the 3.5% range as gasoline and meat got cheaper and clothing prices skyrocketed, the Labor Department said Friday.

With energy and food excluded, the rest of the goods and services in the consumer price index went up 0.6%, the most in nearly three years.

White House spokesman Larry Speakes said the report showed that inflation is remaining "well contained." The overall price index, up 0.2% in January, has not risen more than 0.3% since September.

The January and February price increases would add up to an annual inflation rate of 3.3% if repeated through December. The previous 12 months that ended with February produced an inflation rate of 3.5%.

The index in February reached 317.4, equivalent to a cost of $317.40 for the government's sample "market basket" of goods and services that cost $100 in 1967. The month's increase was right at the 0.3% average per month since October, 1981.

Clothing Prices Up

Clothing prices, held down by price cutting before Christmas, suddenly zipped up 0.9% in February when the sales came to an end.

Fruits and vegetables, still registering the effects of the winter freeze, shot up 2.9%.

New cars, with sticker prices up 0.8%, and used cars, 1.8% more expensive, added more upward pressure.

Gasoline prices in February dropped 2.5% and fuel oil dropped 1.5%.

Poultry and fish slipped 0.2%.

Thursday's government report on the gross national product included its own inflation scare, an "implicit price deflator" showing 5.4% inflation under way this quarter.

While nearly twice the rate in the fourth quarter, it was boosted by technical factors that left an underlying inflation rate of less than 4%, the same as reflected by the consumer price index.

One unusual price increase was recorded last month--the raise in postage costs that added 2 cents to the price of a first-class stamp. The entire increase for all types of postage bought by households showed up in the February report as a 3.5% increase.

Medical Care Costs

Medical care costs rose 0.4% in February and 5.5% for the last year, with hospital charges in February at a rare standstill and doctors' bills up 0.5%.

Housing costs gained 0.4%, with price hikes for rugs, curtains and furniture largely responsible.

The broadest measure of food and beverage prices was up 0.5% in February and only 2.4% for the last 12 months.

Transportation costs dropped 0.1% because of the big gasoline price decline.

Entertainment costs also dropped, down 0.2% for the month.

The miscellaneous category was up 0.6%, including large increases for school books and supplies as well as a 0.7% jump in cigarette prices.

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