CPI: -1.7% for November, 1.1% YOY, Deflation Trumping Inflation, Housing Starts Dismal

The US Consumer Price Index, which measures inflation at the consumer level of the economy, was -1.7% in November and +1.1% year-over-year through November. Excluding volatile oil and food costs from the readings, “Core” CPI for November was 0% and +2.0% YOY through November. Here’s the October CPI report and here’s complete CPI numbers for 3Q2008.

The yearly overall numbers that include oil and food clearly show the effect of dropping oil prices since summer, and the fact that inflation is now within the Fed’s target comfort inflation zone of 1-2%. Given the weakness of the consumer and businesses right now, deflation is the bigger concern, and the Fed said this today when they cut rates to zero and pledged support for mortgage backed bonds. See the right-menu of the site for a rundown of key US and global stocks, commodities and rates–quotes delayed 15-20 minutes.

HOUSING STARTS DOWN
Housing starts were reported at 625,000, down nearly 19% from October and building permits were also reported at record lows of 616,000. These are record lows.