Consumer prices rise

WASHINGTON (AP) -- Consumer inflation rose 0.3 percent in February as falling prices for energy products blunted rising costs for food and prescription drugs, which posted the biggest increase since the middle of 1998.

The Labor Department reported Wednesday that the advance in its Consumer Price Index, the government's most closely watched inflation gauge, followed a big, 0.6 percent jump in January, largely reflecting soaring energy prices.

February's performance represented a slightly worse reading on inflation than many analysts were expecting. They were forecasting that prices would rise 0.2 percent.

The report comes one day after the Federal Reserve slashed interest rates again, the third half-point reduction since January.

Even with February's 0.3 percent rise in consumer prices, economists continue to believe the central bank has room to cut rates again.