Energy lifts inflation, jobless claims decline

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Energy lifts inflation, jobless claims decline

(Reuters) - Consumer prices rose at their fastest pace in more than 1-1/2 years in February, driven by higher food and energy prices, but underlying inflation pressures remained generally contained.

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Though the increase in core CPI was a touch above economists' expectations for a 0.1 percent gain, it suggested that surging costs for energy and other commodities, which have been hitting producers and consumers alike, had yet to generate the type of broad inflation that would spur the Federal Reserve to respond.

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In another report, the Labor Department said initial claims for state unemployment benefits fell 16,000 to a seasonally adjusted 385,000 last week, broadly in line with expectations, hinting at a strengthening in the labor market.

The four-week moving average of unemployment claims -- a better measure of underlying trends - dropped 7,000 to 386,250, the lowest since mid-July 2008 and staying below the 400,000 level for a third straight week.

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