US consumer prices inched up just 0.1 per cent last month as gasoline and car prices tumbled, the government reported today.
A separate report showed initial claims for jobless benefits gained less than expected last week, implying the job market was a touch stronger than analysts had thought.
For the first time in weeks, the claims data appeared unaffected by hurricanes, the US Labor Department said.
Like the overall consumer price index, the so-called core CPI, which strips out volatile food and energy prices, also moved up just 0.1 per cent, the department said.
The report presented a tamer inflation picture than Wall Street had expected. Economists had looked for a mild 0.1 per cent gain in the overall CPI, the most widely used gauge of US inflation, but had expected the core index to rise 0.2 per cent.
A pickup in core inflation earlier this year had sparked some concern that long-dormant inflation was stirring. But the CPI offered confirmation that prices have been kept in check, despite a big surge in the cost of oil.
The core index, closely eyed by officials at the Federal Reserve, has risen just 0.1 per cent for each of the last three months, just a 1 percent increase at an annual pace.
Prices for US bonds and the value of the dollar were little changed after the data. Investors held to the view that the Fed would bump interest rates higher next week but was likely to pause at one of its last two meetings of the year to assess the impact of the rate-rise campaign begun in June.