Last week’s report on the Labor Department’s Producer Price Index showed that deflationary pressures were rising on the wholesale level. Now we have retail inflation and deflation numbers out via the Labor Department’s Consumer Price Index (CPI) for November.
The headline CPI posted its largest decline in almost six years with a drop of 0.3% for November. The core CPI reading, excluding food and energy, was up by 0.1% in November. Dow Jones estimates had the headline CPI at -0.1% and also -0.1% on the core CPI. Bloomberg was calling for a drop at 0.1% on the headline and a gain of 0.1% on the core CPI.
If you look at the year-over-year comparison rather than the month-over-month reading, CPI was up 1.3% on the headline in November and the core CPI was up by 1.7%.
With a 2% inflation target and with prices looking even weaker since, one can only imagine that prices will be even lower for the month of December. Oil was last seen around the $55 per barrel mark for West Texas Intermediate crude. That oil price was above $70 throughout November, and it was around $90 at the end of 2013. What do you think that will do to headline numbers for December when they are released in mid-January?
Wednesday morning’s report from the Labor Department was not as deflationary as the Producer Price Index was last week. It was far from a reprieve though, and we almost certainly can now expect lower prices next month.
ALSO READ: Gold and Silver Outlook for 2015
Is Your Money Earning the Best Possible Rate? (Sponsor)
Let’s face it: If your money is just sitting in a checking account, you’re losing value every single day. With most checking accounts offering little to no interest, the cash you worked so hard to save is gradually being eroded by inflation.
However, by moving that money into a high-yield savings account, you can put your cash to work, growing steadily with little to no effort on your part. In just a few clicks, you can set up a high-yield savings account and start earning interest immediately.
There are plenty of reputable banks and online platforms that offer competitive rates, and many of them come with zero fees and no minimum balance requirements. Click here to see if you’re earning the best possible rate on your money!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.