Consumer Price Index Drops 1.0 Percent, Inflation Slows
|Written by David Rosnick|
|Wednesday, 16 November 2011 12:20|
Consumer prices fell 0.1 percent in October but rose at a 2.4 percent annualized rate over the last three months, according to the Bureau of Labor Statistics' latest reports on the consumer price, U.S. import/export price and producer price indexes. The rate of inflation in the Consumer Price Index has been at 2.1 percent over the last six months, compared with 5.1 percent in the six months ending in April. This is overwhelmingly attributed to falling energy prices, which have dropped at a 3.2 percent annualized rate compared with an increase of a 35.0 percent annualized rate over the prior six months.
There are few signs of inflation, with the rebound of the dollar amidst troubles in Europe, falling trade prices, and producer prices slackening at all stages of production. Even with the drop in energy prices, the real average hourly wage has lagged consumer prices at a 1.2 percent annualized rate over the last three months. Unless there is an increased demand for goods and services domestically and abroad, it's doubtful inflation will be an immediate problem for the economy.
For a more in-depth look, read the latest Prices Byte.