Consumer Prices Dip for First Time in 10 Months - NY Times June 15

[Coastie for Truth]

WASHINGTON (AP) -- Consumer prices fell 0.1 percent in May, the first decline in 10 months as energy prices retreated after a big run-up in the previous three months.

The Labor Department reported Wednesday that the decline in its closely watched Consumer Price Index followed big gains of 0.4 percent in February, 0.6 percent in March and 0.5 percent in April. Those increases had been driven by a surge in energy costs this year as crude oil prices hit all-time highs in early April.

Analysts had expected inflation would moderate in May, given recent declines in energy prices, but the outright drop came as a surprise. They had been forecasting a small 0.1 percent increase. Outside of food and energy, inflation remained well contained as well with a modest increase of just 0.1 percent.

Meanwhile, another goverment report showed that production at the nation's factories, mines and utilities rose a solid 0.4 percent in May, reversing a 0.3 percent decline in April. The increase reflected a big 0.6 percent jump in output in manufacturing as auto production stopped falling and other sectors actually posted increases.

Output at the nation's mines, a category that includes oil production, rose by 0.1 percent while production at utility plants fell by 0.7 percent after an even bigger 2.4 percent decline in April.

The 0.4 percent overall gain in industrial production was double the 0.2 percent increase that economists had been expecting. It left U.S. industry operating at 79.4 percent of capacity in May, up from an operating rate of 79.1 percent in April.

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Good news? Bad news?

[porkrind]

1. Probably just signal noise. The trend is upward.

Lets look at the next few months and see.

[Coastie for Truth]

2. When I was in college

falling prices - or hyper inflation - were both "BAD NEWS."