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Prices continue to fall in December

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Prices continue to fall in December

Decreasing gasoline prices result in largest CPI drop since 2008.

The Consumer Prices Index fell on a seasonally adjusted basis by 0.4% in December, according to the U.S. Bureau of Labor Statistics. This is the largest drop since December 2008, and was driven largely by a significant 9.4% drop in gasoline prices.

The drop was in line with analysts’ expectations.

Over the last 12 months, the index has increased 0.8%.

The index for all items less food and energy, known as “core” CPI, was unchanged in December, following a 0.1% increase in November.  

Core CPI has increased 1.6% over the last 12 months.

The fall in consumer prices gives added strength to the argument against the Fed raising interest rates in the near term.

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