Consumer prices soar in January

WASHINGTON — Consumer prices galloped ahead in January at the fastest pace in four months, especially pinching the wallets of motorists and other energy users.

The latest picture of the nation’s pricing climate, released by the Labor Department on Wednesday, reinforced expectations that Federal Reserve Chairman Ben Bernanke and his colleagues will boost interest rates in the months ahead to blunt inflation.

The government’s most closely watched inflation barometer, the Consumer Price Index, advanced by 0.7 percent, compared with a 0.1 percent dip in December. The seesaw pattern mostly reflects gyrating energy prices.

“Consumers continue to be battered by rising costs,” said Joel Naroff, president of Naroff Economic Advisers. “It’s tough out there for most households.”

Rising inflation is straining families’ budgets. A separate report showed that workers’ average weekly earnings, adjusted for inflation, dropped by 0.4 percent in January compared with a year ago. For most workers last year, paychecks didn’t keep pace with inflation.

While the Bush administration has talked often about the generally good shape of the economy, Democrats have expressed worries about low and middle-income families struggling under the weight of rising prices and living paycheck to paycheck.

The main culprits behind January’s higher CPI reading were rising energy and food prices.

Excluding energy and food costs, though, “core” prices rose by a modest 0.2 percent in January, following a 0.1 percent increase in December.

More costly clothing and new cars were mostly blamed for the slight pickup in core inflation.