Consumer's Are Feeling the Pinch

(AP)
WASHINGTON (AP) — Americans are paying more for food and gas, a trend that threatens to slow the economy at a crucial time.
So far, the spike in such necessities hasn't stopped businesses from stepping up hiring or slowed factory production, which rose in March for the ninth straight month. Still, higher gas prices have led some economists to lower their forecasts for growth for the January-March quarter...

Consumer prices rose 0.5 percent last month, the Labor Department said Friday. Nearly all of the gains came from pricier gas and food...

But most of the extra $1,000 to $2,000 per person is filling the gas tank. The national average for a gallon was $3.82 on Friday — nearly $1 more than a year ago. In five states, the average price is exceeding $4 a gallon...

Rising inflation will likely cut consumer spending growth to half its pace in the previous quarter....

Oil has soared 28 percent to about $109 a barrel since Middle East turmoil spread to Libya in mid-February. If unrest stops spreading and Americans buy less fuel, oil and gas prices could decline...

Joe Olivo, who owns Perfect Printing Inc., based in Moorestown, N.J., says his suppliers are raising the cost of ink and other items 10 percent this month, the biggest monthly increase he can remember in the 23 years he's been in business. He's also paying more for shipping due to fuel surcharges. But so far, he estimates he can only pass on about a third of the higher costs to his clients. Suppliers "are hinting that there may be more (price increases) down the road," he said. "That's really my big concern."

AP Business Writers Anne D'Innocenzio in New York and Daniel Wagner contributed from Washington to this report...

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