Feb. 23 (Bloomberg) -- U.S. consumer prices probably rose 0.2 percent in January, the fifth advance in six months, according to a survey of economists before a government report.

The projection for the consumer price index is the median of 70 economists surveyed by Bloomberg News and would follow no change in December. Excluding food and energy, core prices probably rose 0.2 percent for a fourth month. The report will be issued by the Labor Department at 8:30 a.m. in Washington.

Core consumer prices rose 2.2 percent in 2004, the biggest gain in three years, suggesting companies are having some success in passing on higher supply costs to consumers. Federal Reserve Chairman Alan Greenspan told Congress last week that inflation is still ``well anchored.''

``Higher producer prices will likely pass through to the consumer level over the coming months,'' said Robert Mellman, an economist at J.P. Morgan Securities inc. in New York.

The consumer price index is the government's broadest measure of the costs of goods and services. Almost 60 percent of the index covers services. The index is the last of three monthly reports gauging inflation in the U.S.

Central bankers raised their benchmark overnight bank lending rate a quarter point to 2.5 percent at the conclusion of their two-day meeting Feb. 2, the sixth increase since June 30, to keep inflation in check.

``Core goods prices at the consumer level have accelerated over the past year, and the January figures on core producer prices and import prices point strongly to further acceleration ahead,'' Mellman said.

Greenspan

Greenspan said the economy is growing.

``The economy seems to have entered 2005 expanding at a reasonably good pace, with inflation and inflation expectations well anchored,'' the Fed chairman said in Feb. 16 testimony to the Senate Banking Committee. ``The evidence broadly supports the view that economic fundamentals have steadied.''

Still, a rise in producer prices last month may herald an increase in the rate of consumer-goods inflation, some economists said. U.S. wholesale prices excluding food and energy rose the most in more than six years in January, a government report showed. Manufacturers and other producers coping with rising costs of energy, steel and other raw materials are trying to raise prices to maintain profits.

``This will have Fed officials sweating a little more about the outlook for prices,'' said Stephen Stanley, chief economist at RBS Greenwich Capital in Greenwich, Connecticut.

Campbell Soup Co., the world's biggest soup maker, said last month it plans to raise most U.S. soup prices an average of 4.8 percent, helping mute higher costs. The increase on condensed and ready-to-serve brands takes effect Feb. 28. The Camden, New- Jersey-based company will also raise prices on some sauces and beverages.

Bentonville, Arkansas-based Wal-Mart Stores Inc., the world's largest retailer, said fourth-quarter profit rose 16 percent, helped by fewer holiday discounts. Some companies are still having to discount to stay competitive.

Airlines

American Airlines and four other U.S. carriers matched Delta Air Lines Inc.'s lower fares. American, the world's largest carrier, cut fares as much as 55 percent and ended requirements such as Saturday night stays, the airline said last month. Competition with low-fare airlines has kept ticket prices at 17- year lows.

U.S. auto sales fell 12 percent in January from a month earlier as automakers pared incentives that had helped boost December sales. In response, Ford Motor Co. this month boosted incentives with five-year, no-interest loans on Explorer sport- utility vehicles and some F-Series pickups, matching General Motors Corp.

Wal-Mart Chief Executive Officer H. Lee Scott said Feb. 17 on a recorded message that the company ``would have been better off if we had traded lower markdowns for sales.''

Still, the rise in wholesale prices last month and a decline in the value of the dollar that may allow foreign firms to raise prices in the U.S. suggests the possibility of increased inflation in coming months.

Prices of goods imported into the U.S. increased in January for the first time in three months, led by higher costs for oil, government figures showed on Feb. 17. The costs of imported consumer goods rose the most in a year.

``The constant pressure on producer costs at all levels has to be giving firms fits and causing them to look for any way possible to pass on those higher prices,'' said Joel Naroff, president of Naroff Economic Advisors in Holland, Pennsylvania. ``With the weak dollar hitting import prices, the underlying trend in inflation is not pretty.''

                       Bloomberg Survey

          FIRM                       CPI      CPI
                                              Core
          ----------------------------------------
          Number of replies           70       69
          MEDIAN                     0.2%     0.2%
          AVERAGE                    0.2%     0.2%
          High Forecast              0.4%     0.3%
          Low Forecast               0.1%     0.1%
          Previous                   0.0%     0.2%
          ----------------------------------------
          ABN Amro                   0.2%     0.2%
          4CAST Ltd.                 0.2%     0.2%
          Action Economics           0.1%     0.2%
          AIG Global Invest.         0.4%     0.2%
          AIB Global Treasury        0.2%     0.2%
          Alleti Gestielle           0.3%     0.2%
          Argus Research Corp.       0.2%     0.2%
          BNP Paribas                0.1%     0.2%
          B of A Capital             0.3%     0.3%
          B of A Securities          0.3%     0.3%
          Bantleon Bank AG           0.2%     0.2%
          Barclays Capital           0.3%     0.2%
          Bear Stearns               0.4%     0.3%
          Bank of Tokyo- Mitsub.     0.3%     0.3%
          Briefing.com               0.3%     0.3%
          Calyon                     0.2%     0.3%
          CantorViewpoint            0.3%     0.3%
          CIBC World Markets         0.2%     0.3%
          Citigroup                  0.1%     0.3%
          ClearView Economics        0.3%     0.2%
          Commerzbank                0.2%     0.2%
          Credit Agricole            0.1%     0.2%
          Credit Suisse FB           0.2%     0.2%
          Daiwa Securities           0.2%     0.2%
          DekaBank                   0.1%     0.2%
          Desjardins Group           0.2%     0.3%
          Deutsche Bank Research     0.2%     0.2%
          Dresdner Kleinwort         0.2%     0.2%
          FTN Financial              0.2%     0.2%
          Fortis Bank NV             0.2%     0.2%
          Global Insight             0.2%     0.2%
          Griffin, Kubik, Stephens   0.2%     0.3%
          High Frequency Economics   0.2%     0.2%
          HBOS Treasury              0.2%     0.2%
          HSBC Markets               0.2%     0.2%
          HypoVereinsbank            0.3%     0.2%
          I.D.E.A.                   0.2%     0.2%
          ING Financial Markets      0.3%     0.2%
          Informa Global Markets     0.2%     0.2%
          IntesaBci                  0.2%     0.2%
          J.P. Morgan                0.2%     0.2%
          JPMorgan Fleming           0.1%     0.2%
          Landesbank BW              0.2%     n/a
          Lehman Brothers            0.1%     0.1%
          Macroeconomic              0.2%     0.2%
          Merrill Lynch              0.1%     0.2%
          Mizuho Securities          0.2%     0.2%
          Morgan Keegan              0.3%     0.2%
          Morgan Stanley             0.2%     0.2%
          National Bank Financial    0.3%     0.3%
          National City Bank         0.2%     0.3%
          Nesbitt Burns BMO          0.3%     0.3%
          Nomura                     0.1%     0.2%
          Nord/LB                    0.3%     0.2%
          PNC Bank                   0.2%     0.3%
          Prebon Marshall            0.2%     0.2%
          RBC Capital Markets        0.1%     0.3%
          RBS Greenwich Capital      0.2%     0.2%
          Ried, Thunberg & Co.       0.1%     0.2%
          Scotiabank Group           0.2%     0.2%
          Societe Generale           0.2%     0.2%
          Stone & McCarthy           0.1%     0.1%
          Thomson/IFR                0.2%     0.2%
          UBS Securities LLC         0.2%     0.3%
          Ulpia                      0.2%     0.2%
          Unicredit Banca Mobilare   0.3%     0.2%
          Wachovia                   0.1%     0.1%
          Wells Fargo                0.2%     0.3%
          Westpac Banking            0.1%     0.1%
          Wrightson                  0.1%     0.2%

To contact the reporter on this story: Joe Richter in Washington at jrichter1@bloomberg.net

Last Updated: February 23, 2005 00:11 EST