US consumer prices tick up just 0.1 percent as inflation stays tame

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WASHINGTON (AP) U.S. consumer prices rose just 0.1 percent in June, as cheaper gas prices were offset by higher rents and auto costs.

The Labor Department said Thursday that the consumer price index increased 1.6 percent in June from a year earlier.

That is down from 1.8 percent in May and the second straight drop. Excluding the volatile food and energy prices, core inflation rose 0.3 percent in June, the biggest increase in 18 months.

It rose 2.1 percent from a year ago.

Inflation has been muted throughout the 10-year expansion, now the longest on record, even as the unemployment rate has dropped to 3.7 percent, near the lowest in five decades.

Federal Reserve policymakers have cited low inflation readings as a justification for potentially lowering short-term interest rates at its next meeting in late July.