Skip to Content

Exclusive: Rock Band Unplugged Track List

Good economic news: Consumer prices up

More
Text SizeAAA

Filed under: Borrowing, Food, Recession

The news that consumer prices are up may not sound like good news, but it is during a recession.

The Consumer Price Index for All Urban Consumers, or CPI-U, increased 0.3% in January after declining in each of the three previous months, according to the federal Bureau of Labor Statistics.

While it was only a slight increase, it wasn't a decrease in the prices people pay for goods, such as food and energy, as has happened for a long while.

What has been happening during much of the recession is deflation, or the dropping of prices because consumers aren't buying much. That creates a vicious circle, leading companies to stop production to get rid of inventory, and for consumers to expect prices to drop continuously and thus waiting for prices to drop enough for a great bargain. Deflation was a big part of Japan's "Lost Decade" in the 1990s.

While the CPI-U for the 12 months ending in December 2008 was unchanged, it has increased for the past three months, and if that trend continues it could point to the recession lessening as prices increase.

Energy, for example, climbed 1.7% in January, its first increase in six months. But don't get too excited; energy prices are still low. The energy index was still 31.4% below its July 2008 peak. And in case you haven't' noticed higher prices at the gas pump, the gasoline index rose 6% in January after a 19.3% drop in December.

The food index has risen 5.3% over the past year, although fruits and vegetable prices continue to fall. The CPI-U also saw large increases in the indexes for rent, new vehicles and apparel.

Deflation, and the problems that come with it such as companies laying people off, isn't over yet, but it looks to be slowly going away.

Here's a quick primer on the CPI:

Subscribe to Walletpop

Featured Sponsor

Refinance Your Home
Lower Your Payments!




Loans: Get the Basics

In addition to using our calculators for loans and finding out the current rates on loans, educate yourself on the basics of the loans you are shopping for.

What are the Next Hot-Spots in the Luxury Resort Scene?
Luxist Awards asked three of our Expert Panelists, all veterans of the travel industry, about the ...
The Luxist Awards for Best Accessories
Do you know of a magnificent jewelry line with pieces that are to die for? Which is the finest ...

Julie Tilsner
Julie Tilsner Filed under: Recalls

More than 2 million Stork Craft drop-side cribs recalled

More than 2.1 million drop-side cribs are being voluntarily recalled by their manufacturer, Stork Craft Manufacturing, Inc., after four incidents in which infants were trapped and suffocated, ...
Josh Smith
Josh Smith Filed under: Bargains

Deal of a lifetime: Bargain shopper proposes on deal Web site

On Saturday morning an amazing deal popped up on the Dealnews.com Web site -- a free engagement ring. But, like all great deals this one came with a catch, it was only good for Stefanie Setlock of ...
Martha C. White
Martha C. White Filed under: Banks, Banking-savings-account

Low interest rates good for borrowers, bad for savers

Americans are saving more of their earnings than they have in years, and that's a good thing. But unfortunately, we're not being rewarded for it the way we were in flusher years. By now, everyone ...
Kelly Phillips Erb
Kelly Phillips Erb Filed under: Tax, Celebs & Money

"Blade" files appeal in Atlanta

The Wesley Snipes show was back in federal court in Atlanta, Georgia. The actor, however, was noticeably absent as his attorneys did the talking. Snipes, who was sentenced to a maximum three years in ...

Headlines from WalletPop Partners