Wikinvest Wire

More fodder for the inflation-deflation debate

Thursday, November 05, 2009

Those thinking that we've seen the last of inflation for a while might want to have a look at what gasoline prices have been doing lately, that is, relative to a year ago. For the second straight week, the national average for the price at the pump was higher than a year ago.
IMAGE It may not look like much now, but, next month the comparisons will be done against gasoline that sold for as little as $1.61 a gallon last December. Some quick math indicates that the most recent national average of $2.69 a gallon would represent an increase of 68 percent.

This will show up in the inflation data before long, however, at the moment it looks like the year-over-year increases in energy prices may be offset, at least in part, by falling rents.

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hardredwinterwheat said...

B-b-but ... don't we discount the "volatile energy and food sectors" when assessing inflation risk ? (unless they're on the decline, and then of course, we include them)

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