February 19, 2010

EXCEPT THAT MEANS REAL INTEREST RATES ARE HIGH, NOT LOW:

Consumer prices excluding food and energy fall (Associated Press, February 19, 2010)

Consumer prices rose less than expected in January while prices excluding food and energy actually fell, something that hasn't happened in more than a quarter-century.

The Labor Department said Friday that consumer prices edged up 0.2 percent in January while prices excluding food and energy slipped 0.1 percent. That was the first monthly decline since December 1982.

The benign inflation news gives the Federal Reserve more time to keep interest rates at record-low levels to shore up the economy and should ease worries in financial markets that a Fed rate hike is more imminent.

Posted by Orrin Judd at February 19, 2010 11:40 AM
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