While consumer spending fell in July, prices remained the same.
From Timothy R. Homan, Bloomberg:
Aug. 14 (Bloomberg) -- The cost of living in the U.S. was unchanged in July, and dropped by the most since 1950 from a year ago, as the recession sapped companies’ pricing power.
The flat reading matched the median forecast of economists surveyed by Bloomberg News and followed a 0.7 percent increase in June, data from the Labor Department showed today in Washington. Excluding food and energy costs, the so-called core index rose 0.1 percent, also as anticipated.
Today’s figures indicate no sign that the Federal Reserve’s record $1 trillion of injections into the banking system have passed through to faster inflation. Retailers including Nordstrom Inc., Abercrombie & Fitch Co. and American Eagle Outfitters Inc. have used discounts to lure consumers on tight budgets in the aftermath of job losses and home-price declines.
