Overall Consumer Price Infation down 0.5% in September

by Patrick Lunsford, CollectionIndustry.com

The consumer price index (CPI), a consumer-focused measure of U.S. inflation, dropped 0.5% in December, the Labor Department reported Wednesday.

The decline marked the largest drop since November of last year.

The largest factor in the falling prices were energy costs, specifically gas. The core CPI, which excludes food and energy prices, rose 0.2% in the month, the third straight month of such gains.

The drop in September’s CPI reading was larger than expected, while the rise in core CPI matched forecasts by Wall Street economists. While the drop in overall CPI was a good sign for policy-makers at the Federal Reserve, core CPI is still a worry.

The core CPI’s now up 2.9% in the past year, compared with a 2.8% increase in the 12 months through August. This is the highest level since February 1996. The core CPI has risen at a 3.0% annual rate so far this year.