Inflation weakens in October as gas prices fall

/ Source: The Associated Press

Inflation pressures bombarding consumers moderated significantly last month as energy prices retreated after hitting record highs in September.

The Labor Department reported that consumer prices edged up just 0.2 percent in October, which was the best showing in four months. In September, consumer prices had soared by 1.2 percent, the biggest one-month increase in 25 years.

The slowdown in price pressures reflected a 0.2 percent drop in energy costs, a significant change from the record 12 percent increase in energy prices in September, a surge that had reflected widespread shutdowns of refineries and oil platforms along the Gulf Coast in the wake of hurricanes Katrina and Rita.

Excluding food and energy, core inflation edged up 0.2 percent in October. While that was up from the 0.1 percent increases of the previous five months, it was still considered to be a moderate gain indicating that the surge in energy prices this year has not caused more widespread inflation problems.