December 12, 2014


US Producer Price Index down 0.2% in Nov  (Reuters, 12/12/14)

[A] core measure of producer inflation, which excludes food, energy and trade services, was flat. That could be worrisome for Federal Reserve policymakers who are expected to debate next week whether to keep a pledge that borrowing costs will stay at rock bottom for a "considerable time."

When compared to a year earlier, that core index was up just 1.5 percent, and the annual reading has been dropping a tenth of a point each month since September.

Another core reading that only strips out food and energy was also flat on the month and up 1.8 percent from November 2013.

Fed officials largely view the current low inflation environment as transitory and believe the likelihood of inflation running persistently below the U.S. central bank's 2 percent target has diminished somewhat since early this year.

Who's winning the price wars? Consumers (Kathryn Vasel, December 12, 2014, CNNMoney)

The pricing wars heated up with Wal-Mart (WMT) and Best Buy (BBY) unveiling price-matching policies and Target (TGT) offering free shipping on all online orders for the holidays. And Wal-Mart just announced it's slashing prices on Apple iPhones.

Data from mobile shopping app ShopSavvy showed that on average, Wal-Mart is the cheaper option on more than 50% more products than Amazon and Best Buy, across all categories analyzed.

"A couple of years ago, Amazon was the only one matching prices," said Mark LoCastro, spokesperson for deal aggregator DealNews. "But now other people are in the game ... Amazon is trying new tactics to keep people in their eco-system." [...]

The price battle is far from over, but there's already a clear winner: consumers. "The longer they fight, the better it is for the consumer," said LoCastro. 

Posted by at December 12, 2014 6:27 PM

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