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Consumer prices stabilized in June

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Food costs went up again but consumers finally got a break at the gas pumps in June, helping to lower inflation to the smallest increase in five months, the Associated Press reported.

The U.S. Labor Department reported today that the Consumer Price Index edged up 0.2 percent in June following a 0.7 percent surge in May, which had been the biggest jump in 20 months.

The price moderation reflected a 1.1 percent decline in gasoline prices, which pushed total energy costs down by 0.5 percent, offsetting a 0.5 percent rise in food costs.

Core inflation, which excludes the volatile energy and food sectors, was also moderate in June, with prices rising by just 0.2 percent. Through the first six months of this year, core inflation has been rising at an annual rate of 2.3 percent, down from 2.6 percent in the last half of 2006, indicating that the surge in energy and food costs are not becoming embedded in more widespread inflation problems.