Consumer Prices Jump, but Industrial Production Off : Economy: The January index figure is a higher-than-expected 0.3%. Output rose half as fast as in previous months.

Consumer prices jumped a higher-than-expected 0.3% in January, the government reported Wednesday, but industrial production rose only half as fast as in previous months, suggesting to some that inflation remains a worry even as the economy shows signs of slowing down.

The stock market reacted favorably to the news of a slowing economy, sending the Dow Jones industrial average to a record high of 3,998 before falling back to close up 27.92 points at 3,986.17, a record.

“What we have is an economy that seems to be moving on to a slower growth path, where inflation nonetheless remains a . . . concern,” said Robert G. Dederick, an economic consultant to the Northern Trust Co. in Chicago.

But Bruce Steinberg, an economist at Merrill Lynch & Co. in New York, downplayed the significance of the relatively strong consumer price growth, arguing that it overstates the level of inflation.

“All the data say the economy is slowing down, just as the Federal Reserve wants it to,” he said. “Despite the pickup in the (consumer price index), inflation looks pretty much contained.”

The bond market viewed the data with ambivalence. Bond prices at first soared and yields dropped to five-month lows as investors initially saw the consumer price figures as overstating the level of inflation.

But the rally weakened after Federal Reserve Chairman Alan Greenspan, speaking at a bankers convention in Honolulu, issued warnings that he saw “reasons for some concern” about higher prices.

January’s jump in the seasonally adjusted consumer price index was the largest in five months, and it came on the heels of a 0.1% increase in November and a 0.2% one in December, the Labor Department said.

Economists say the increase reflected unusual first-of-the-year price jumps, particularly in energy and housing prices. In addition, the January index reflected price rises in furniture, apparel and airline fares, which had been falling for several months before.

The index level last month was only 2.8% higher than that at the end of January, 1994, in keeping with the overall 2.7% inflation rate of the last two years.

The Fed also reported Wednesday that industrial output grew in January at less than half the pace of the two preceding months, although capacity utilization rates remained at a 15-year high. Production at factories, mines and utilities went up 0.4% in January, compared to 0.8% in November and 0.9% in December.

“After the torrid rate of increase in recent months, I think we’re seeing a consolidation that’s absolutely to be expected,” said Richard Berner, chief economist at Mellon Bank in Pittsburgh.