All Consumer Prices Continue to Rise

By BRIAN BLACKSTONE and JEFF BATER / WALL STREET JOURNAL

WASHINGTON -- U.S. consumer prices increased for a second-straight month to start the year for everything from clothing and new cars to medical care, raising the odds that the U.S. will avoid a protracted deflationary spiral of falling prices and spending.

Still, prices barely rose from a year ago while core inflation that excludes food and energy was mild, suggesting inflation isn't a worry, either. That should give Federal Reserve officials the flexibility to continue pursuing very aggressive policies to revive the economy.

Separately, the U.S. current account deficit narrowed sharply at the end of 2008, reflecting a recession driving down oil prices and demand for other foreign goods.