Inflation Zero

2010, a Year of No Inflation


On Friday, the Labor Department will release the inflation number for August. Economists are expecting an increase of about 0.2 to 0.3 percent over July’s Consumer Price Index. If that’s correct, it won’t be nearly enough to reverse a remarkable period in which prices have barely risen at all.

Over the last two years, inflation has been zero. Over the last year, it has been just 1.3 percent. Over the last six months, it has been below zero — negative 0.7 percent.

Since the Labor Department started keeping records in 1947, there have been only six six-month periods when prices have fallen more than that. All of them were in 1950, an unusual time when prices were falling even though the economy was growing.

Comment: What is still strongly inflationary: tuition and health care costs

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