Consumer prices rise in Aug. on higher gas prices

WASHINGTON - Consumer prices rose slightly in August due to higher gas prices, another sign the weak economy is keeping inflation in check.

The Labor Department says the Consumer Price Index rose 0.4 percent last month, after a flat reading in July. Wall Street economists expected a 0.3 percent increase, according to a survey by Thomson Reuters.

Excluding volatile food and energy prices, the core price index rose 0.1 percent, matching expectations.

Prices fell 1.5 percent in the past year, as gas prices dropped sharply from record levels last summer.

The core CPI rose 1.4 percent in the 12 months ending in August.

Prices for new cars fell 1.3 percent last month, the steepest drop in nearly 37 years, due to rebates under the Cash for Clunkers program.