In addition, there are few signs of any increase in inflationary pressures at earlier stages of the production pipeline. Consumer price inflation has also run below projection. Through the first half of the year, the consumer price index was up at only a 1.4 percent annual rate, less than one-half of last year's rate of inflation. This, too, reflects declines in energy prices. The closely-watched core consumer price index, which excludes food and energy, increased at a 2.4 percent annual rate in the first half of the year, a little below last year's rate.
Services constitute a little over one-half of the consumer price index.
Commodities included in the consumer price index actually fell in price during the first half of the year and rose at less than a 1 percent annual rate if the food and energy commodity components are excluded. Good inflation performance can probably be expected to continue along a path of moderate growth. Certainly, there was little in this morning's employment cost index results which suggests that rising cost pressures are currently much of a problem. This represents a slight decline from the 2.9 percent increase in the previous 12-month span ending in March. Both the wage and salary and the benefit component of the index were in line with recent experience.