Gas Prices Drops Lead to Overall Deflation in November

Gasoline prices dropped another 6.6% in November, bringing the year-over-year decline to 10.5 percent.  And since the average U.S. consumer spends almost five percent of their budget on gasoline alone, the price drop helped pull the overall consumer price index (CPI) down by 0.3% in November. 
In the past year, inflation, as measured by growth in the the CPI, has been just 1.3%.

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We can dig further into the price report to see changes in prices of particular goods.  For example, the price of cookies increased by 1.8% in November. However, the price of flour and prepared flour mixes declined by 2.7%, so you might consider baking your own cookies.

As usual, I also give you a few selected goods that have had both significant price rises and significant price falls (in the table below).

Inflation 12-17-14

According to the Energy Information Administration, the national average gas price is now at its lowest level since December 2008.  That certainly makes it cheaper to drive home for the holidays.



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