Tuesday, Dec 16, 2008
U.S. consumer prices plunged at a record rate for a second straight month during November, according to a government report on Tuesday that is likely to fan fears that economic recession is rapidly heightening risks of deflation.
The Labor Department said its closely watched Consumer Price Index dropped 1.7 percent after falling 1 percent in October–back-to-back record drops since the department started keeping monthly data in 1947. Core prices that exclude food and energy items were flat in November after declining 0.1 percent in October.
The drop in overall prices exceeded forecasts by Wall Street economists who had expected a 1.2 percent decline.
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On a year-over-year basis, consumer prices were up 1.1 percent after a 3.7 percent increase in October. It was the smallest rise since mid-2002.
Energy prices plummeted 17 percent last month, double the 8.6 percent fall in October. It was the largest monthly decrease in energy prices since the department started monthly records in 1957.