Consumer prices rise by modest 0.3 percent in February

<br> <br>WASHINGTON (AP) _Consumer prices rose by a modest 0.3 percent in February as high energy costs continued to hit the pocketbooks of drivers filling up at the pump and people heating their homes.

Wednesday, March 17th 2004, 12:00 am

By: News On 6

WASHINGTON (AP) _Consumer prices rose by a modest 0.3 percent in February as high energy costs continued to hit the pocketbooks of drivers filling up at the pump and people heating their homes.

The increase in the Consumer Price Index, the government's most closely watched inflation measure, however, marked a slowdown from the 0.5 percent jump registered in January, the Labor Department reported Wednesday.

Excluding energy and food costs, ``core'' consumer prices rose by just 0.2 percent in February for the second month in a row. That suggested the prices for many goods and services were fairly stable.

Federal Reserve Chairman Alan Greenspan and his colleagues said inflation is not a problem for the economy. That's one of the main reason why Fed policy-makers have leeway to hold short-term interest rates at a 45-year low of 1 percent, as they did on Tuesday.