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November 20, 2013

Consumer Prices Easing in US

by VOA News

Consumer prices are easing in the U.S., pushed down by a drop in gasoline prices that motorists pay at service stations.

The U.S. government reported Wednesday that gas prices fell nearly 3 percent in October, as world oil prices decline and U.S. oil production advances. Overall, the country's Consumer Price Index fell a tenth of a percentage point last month, its first drop since April.

Inflation is tame in the United States, with consumer prices up 1 percent over the last 12 months, the smallest year-over-year increase since 2009. That increase is half the 2 percent inflation target policy makers have set at the U.S. central bank, the Federal Reserve.

But with high unemployment in the U.S. and modest wage increases for most workers, consumer spending has been cautious and businesses have been reluctant to increase prices.

In a separate report, the government said increased car sales pushed consumer spending up four-tenths of a percent in October. But excluding the purchase of autos, sales only edged ahead by half that.

The Federal Reserve is weighing whether to trim its direct support of the U.S. economy, its massive purchase of securities designed to pump money into the economy, keep interest rates low and boost job growth.

Some information for this report was provided from AP and Reuters.