A leveling off of gasoline and oil-prices helped bring down the annual rate of inflation to 7.5 percent in March, the lowest since last summer, the government reported. The latest reading of the consumer price index means social security payments will climb 11.2 percent for 36 million recipients, starting in July.
Slower gasoline and oil price rises helped offset rising food and clothing prices to produce a 0.6 percent increase in the index for the month, seasonally adjusted. In February, it went up 1 percent.
The Labor Department, using unpublished seasonally adjusted index figures, calculated the annual rate of consumer price inflation at 7.5 percent. That is the lowest since July, when plummeting mortgage interest rates brought overall price inflation down to a 1.2 percent annual level, after revision.
Murray Weidenbaum, chairmen of the Council of Economic Advisers, cautioned against being either optimistic or pessimistic about the latest inflation figures. "The financial markets and the business community are waiting for a signal," he said. "The signal they've waiting for isn't any brilliant prose to come from either end of Pennsylvania Avenue. They're waiting for the action on our budget-cut program, because that will be taken as the signal that this nation is earnest in fighting inflation over the long run." He added that the index improvement was due to a modest decline in housing costs and the l essening impact of oil decontrol.