The price of gasoline dropped last month, but the cost of food, clothing and housing rose, according to the Washington Post.
Consumer prices increased by just 0.2 percent in April and rose by just 0.3 percent in March, according to the Labor Department. That's the smallest increase in more than a year. Prices have gone up 2.3 percent in the last 12 months. Gas prices dropped 2.6 percent in April, the biggest decrease in six months.
Small increases can help the economy as they leave consumers with more money to spend, according to the article. Low inflation also lets the Fed keep interest rates down in an effort to encourage borrowing to stimulate the economy.
"We see little in the way of significant inflation pressures," Dan Greenhaus, chief global strategist at BTIG, an institutional brokerage, told the Washington Post.
But Americans' pay is struggling to keep up with the modest price increases as their hourly pay has increased just 1.3 percent in the last 12 months, according to the article. After adjusting for inflation, Americans' average pay is down 0.5 percent from April 2011 to April 2012.
Email: [email protected]