US consumer spending rises 0.2% in Jan; weekly jobless claims at 48-yr low

US consumer prices increased in January, with a gauge of underlying inflation posting its largest gain in 12 months, bolstering views that price pressures will accelerate this year.
Inflation is also likely to get a boost from a tightening labor market. Other data on Thursday showed the number of Americans filing for unemployment benefits fell last week to the lowest level in just over 48 years.

A robust labor market and rising inflation could force the Federal Reserve to raise interest rates a bit more aggressively this year than currently anticipated to prevent the economy from overheating. The Fed has forecast three rate hikes in 2018. U. S. financial markets have priced in a rate increase this month.

The Commerce Department said consumer prices as measured by the personal consumption expenditures (PCE) price index rose 0.4 per cent. That was the biggest increase since September and followed a 0.1 per cent gain in December. In the 12 months through January, the PCE price index rose 1.7 per cent after a similar gain in December.