U.S. consumer prices dipped in December as oil prices declined, but prices still rose at the fastest rate in four years during 2004, the U.S. Labor Department said today.

The U.S. consumer-price index fell by 0.1% in December. The core index, which strips out volatile food and energy prices, rose by 0.2% for the third consecutive month.

Over the course of 2004, consumer prices rose 3.3%, the fastest pace since 2000. The more stable core index rose 2.2%.

Energy prices fell 1.8% in December. Gasoline prices fell 3.7% in the biggest decline since October 2000, but natural-gas prices rose 1%. Food prices were steady for the first time in three months.

Meanwhile, after slipping in November, U.S. housing starts increased 10.9% to a seasonally adjusted 2.004 million annual rate in December, the Commerce Department said.

For the entire year, an estimated 1.953 million housing units were started, 5.7% above 2003’s non-seasonally adjusted 1.847 million. Starts have gone up every year since falling 4.4% in 2000.

Separately, the Labor Department said average weekly earnings of U.S. workers, adjusted for inflation, rose 0.5% — the biggest increase in six months. Average hourly earnings rose 0.1% and average weekly hours rose 0.3%.

Initial jobless claims fell by 48,000 to 319,000, after seasonal adjustments, in the week that ended Jan. 15. It was the biggest decline since the week of Dec. 8, 2001. The four-week average declined by 3,000 to 341,000.