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Inflation showed signs of stirring in February, signaling an improving U.S. economy is starting to give companies the ability to charge more.

The consumer-price index rose 0.2 percent, the first gain in four months, a Labor Department report showed Tuesday in Washington. Core costs, which exclude food and energy, also increased 0.2 percent, exceeding the median forecast of economists surveyed by Bloomberg and reflecting broad-based advances in rents, new and used autos, clothing and air fares.

Prices should “see further stabilization this year as we expect overall growth to firm from what’s going to be a lackluster pace in the first quarter,” said Sam Bullard, a senior economist at Wells Fargo Securities LLC in Charlotte, North Carolina, which is the top forecaster of core inflation. “Once we get into the second half of this year and into 2016, it’s not going to take much effort to get headline inflation toward 2 percent.”

That would match the target set by Federal Reserve officials, who last week said they needed to be convinced inflation would eventually accelerate before raising interest rates. Other reports Tuesday showed home sales unexpectedly climbed in February and manufacturing picked up in March as the effects of harsh winter weather and the work slowdown at West Coast ports dissipated.

Stocks fell as investors weighed the economic data for clues on when the Fed will raise interest rates. The Standard & Poor’s 500 Index declined 0.6 percent to 2,091.5 at the close in New York. The S&P Supercomposite Homebuilding Index rose 1.4 percent.

Survey Results

The increase in consumer prices matched the median forecast of 88 economists surveyed by Bloomberg. Core costs were projected to rise 0.1 percent, the survey showed.

On a year-over-year basis, core prices climbed 1.7 percent in February after rising 1.6 percent in the previous 12 months.

Fed officials are keeping an eye on inflation and need to be “reasonably confident” prices will move toward their goal in the medium term before they raise benchmark interest rates.

“The committee continues to expect a moderate pace of GDP growth with robust job gains and lower energy prices supporting household spending,” Fed Chair Janet Yellen said in a March 18 press conference following the conclusion of a two-day monetary policy meeting in Washington.

The Fed’s preferred measure of price pressures, linked to consumer spending, climbed by 0.2 percent in January from a year before, the weakest reading since October 2009. It hasn’t reached the central bank’s 2 percent goal since April 2012.

Fuel Costs

A rebound in fuel costs helped pace the advance in prices. Energy costs climbed 1 percent in February after declining for seven consecutive months. A drop in fuel prices since last year has given some households relief at the pump, while oil producers have scaled back production to help balance supply with demand.

The Labor Department’s consumer price report showed food costs increased 0.2 percent in February.

Food and paper expenses at Shake Shack Inc., the burger chain founded by restaurateur Danny Meyer, climbed in the fourth quarter “due to higher commodity costs, particularly beef,” Chief Financial Officer Jeff Uttz said on a March 11 conference call. “Looking ahead, we expect continued pressure on beef prices and as a result anticipate overall commodity inflation for at least 2015 to remain at elevated levels.”

Home Sales

Figures from the Commerce Department Tuesday showed purchases of new homes unexpectedly rose 7.8 percent in February from the prior month to a 539,000 annualized pace, the most since February 2008. The reading exceeded even the most optimistic forecast of economists surveyed by Bloomberg.

Americans withstood weaker income gains and higher property prices, braving a chillier-than-usual February to buy a house. Further healing in the labor market and a boost in inventory should provide additional support to an industry entering its busiest time of year.

“It looks like the spring selling season is off to a good start,” said Stan Shipley, an economist at Evercore ISI in New York, whose projection for 485,000 sales was among the closest in the Bloomberg survey. “With low mortgage rates, if you look at it, it’s very affordable for most potential homeowners,” even as credit remains tight, he said.

Also Tuesday, the Markit Economics preliminary U.S. manufacturing index unexpectedly rose to 55.3 in March from a final reading of 55.1 a month earlier, the London-based group said. Readings greater than 50 signal growth.

Manufacturing Outlook

“Manufacturing regained further momentum from the slowdown seen at the turn of the year, with output, new orders and employment growth all accelerating in March,” Chris Williamson, chief economist at Markit, said in a statement. “The upturn in order books in particular gives some reassurance that the pace of economic growth is likely to pick up.”

Regional manufacturing measures have been less upbeat. The Federal Reserve Bank of Richmond’s factory gauge, also issued Tuesday, showed manufacturing contracted in the region.

The world’s largest economy is projected to expand at a 2.2 percent annualized pace this quarter, matching the previous three months’ rate, according to the median estimate of economists surveyed by Bloomberg this month. Growth is forecast to average 3 percent over the rest of the year.

“We believe activity, particularly with the consumer, is going to snap back,” said Wells Fargo Securities’s Bullard.

(Updates with closing stocks in fifth paragraph.)