Fed to buy $1 trillion in securities, expects inflation to remain subdued

With expectations for inflation to remain under control and in a move to combat the recession, the Federal Reserve on Wednesday said it would pump more than $1 trillion into the economy.

In a statement following the conclusion of its two-day policy meeting, the Federal Open Market Committee (FOMC) said it would:

  • Increase its purchases of mortgage-backed securities by $750 billion, on top of the already announced $500 billion
  • Buy $300 billion of long-term Treasurys over the next six months

The Fed hopes the first measure will pull down mortgage rates and the second will help ease the credit crunch. Immediately following the news, U.S. stocks rallied, bond prices surged and gold prices reversed direction. Continue reading Fed to buy $1 trillion in securities, expects inflation to remain subdued

Consumer prices jump 0.4%, annual inflation at 0.2%

Energy prices drove consumer prices higher for a second month in February and at the fastest pace in seven months, the Labor Department said Wednesday. About two-thirds of the increases resulted from a jump in gasoline pump prices. And with that, the annual U.S. inflation rate climbed to 0.2% after the 0% reading reported in January.

The Consumer Price Index (CPI) increased 0.4% in February — the biggest one-month jump since July — and follows the 0.3% rise in January that economists were again expecting. The extra bump helps dispel some fears of chronic price declines, known as deflation, which can have a devastating impact on the economy and employment.

"Worries about deflation can be set aside right now," Bernard Baumohl, managing director of the Economic Outlook Group, was quoted on NYTimes.com. "It’s unlikely we would have seen inflation drop to negative levels for more than a year, given all the fiscal and monetary stimulus that’s in the economy. The math just didn’t work out."

The CPI is the key government gauge for inflation. The core CPI, which excludes volatile food and energy prices, is even more closely watched. It increased by 0.2% for the second month in a row. Continue reading Consumer prices jump 0.4%, annual inflation at 0.2%

Inflation rates and charts – 3/18 update

Consumer prices increased more than the February forecast and to 0.4%, according to the latest data from the Bureau of Labor Statistics (BLS) provided on Wednesday, March 18.

The Consumer Price Index (CPI) data has the annual inflation rate at 0.2% compared to the January rate of 0%, which marked the lowest level since 1955.

The Inflation Calculator is updated with the newest government information, as are the following pages:

Consumer Price Index Data from 1913 to 2009

Current Inflation Rates: 1999-2009

Historical Inflation Rates: 1914-2009

Annual Averages for Rate of Inflation

For an in depth look at February consumer prices, follow Consumer prices jump 0.4%, inflation at 0.2%.


Producer prices up 0.1% in February, less than expected

U.S. Producer prices climbed 0.1% in February as higher energy prices weighed into the increase for the second consecutive month, according to a Labor Department report released Tuesday.

However, the increase was less than expected, with analysts forecasting a 0.4% rise in the government’s Producer Price Index (PPI), which measures prices at the factory door and inflation pressures before they reach the consumer.

"There’s just a huge amount of slack now in the U.S. economy and the global economy" that’s keeping prices down, said Scott Brown, chief economist at Raymond James & Associates Inc. in St. Petersburg, Florida. "That’s going to hang around for some time."

The PPI rose 0.8% in January, which was the first increase since August 2008. Continue reading Producer prices up 0.1% in February, less than expected

Apocalypse Now… Inflation. Deflation.

Inflation. Deflation. Inflation. Deflation. . . . Back and forth we go as the carousel of experts debate unendingly about whether or not the U.S.S. Armageddon is facing a northerly or southerly economic wind. Meanwhile, all hands on deck are getting sea sick.

Since GoldandSilverNow.com launched in early November, I’ve spent long hours on the telephone with people from across this nation. The truth is, ordinary folks aren’t talking about inflation or deflation. The words are: Desperation. Starvation. Migration. Depravation. Damnation . . . Obamanation. Chem Trail Nation. FEMA Concentration.

One gentleman this week asked me why I wasn’t selling the world’s most valuable commodity: food.

Another gentleman told me I needed to add a third precious metal to my website: lead.

One guy spent thirty minutes touting the importance of buying solar panels – NOW! Continue reading Apocalypse Now… Inflation. Deflation.