· In November, the consumer price index (CPI-U) remained unchanged following  0.5% declines during the prior two months. Consensus expectations had been for a 0.2% rise.

· Prices less food & energy also were unchanged after the weak 0.1% October increase. Core prices were last unchanged in June of 2005 and here too  Consensus expectations had been for a 0.2% increase.

· Core goods prices fell 0.4%. The decline was the fourth in the last five months and was the largest since October 2003. New & used motor vehicle prices dropped 0.8% (-0.9% y/y), off for the third consecutive month, while  apparel prices fell 0.3% (+0.2% y/y) for the second consecutive down month.

· Household furnishings & operation prices added to the list where prices fell with a 0.2% decline (+0.9% y/y). Also in the act of decline were medical care commodity prices which fell 0.4% (+2.3% y/y) and tobacco prices which fell 0.3% (+1.6% y/y).

· With a 0.2% increase, core services prices posted the weakest gain since this past August. Most of the weakness owed to a 1.9% (-0.2% y/y) decline in public transportation costs, the third consecutive monthly decline. Shelter prices rose 0.4% (4.2% y/y) as the rental equivalence measure of owners' primary residences rose 0.3% (4.3% y/y). Rents rose 0.4% (4.1% y/y) for the sixth consecutive month. Education costs rose a strong 0.5% (6.3% y/y) and medical care services prices increased 0.3% (4.0% y/y).

· Energy prices fell 0.2% after two months of roughly 7.0% decline. Gasoline prices fell another 1.6% (-4.2% y/y) but have moved higher in December to an average $2.30 per gallon from $2.23 in November. Fuel oil prices last month rose 0.3% (-3.0% y/y) after two 6.1% m/m declines. Natural gas prices rose 4.7% (-19.9% y/y) but electricity prices fell 0.2% (+6.5% y/y) for the second consecutive month.

· Food & beverage prices slipped 0.1%. Dairy product prices fell 0.6% (-1.6% y/y) but prices for meats, poultry, fish & eggs were unchanged (1.2% y/y).

· The chained CPI, which adjusts for shifts in the mix of consumer purchases, fell 0.2 as did prices less food & energy prices.

Consumer Price Index

November

October

Y/Y

2003

Total 

0.0%

-0.5%

2.0%

2.3%

 Total less Food & Energy

0.0%

0.1%

2.6%

1.5%

  Goods less Food & Energy

-0.4%

-0.3%

-0.1%

-2.0%

  Services less Energy

0.2%

0.3%

3.7%

2.9%

 Energy

-0.2%

-7.0%

-3.6%

12.2%

 Food & Beverages

-0.1%

0.3%

2.3%

2.1%

Chained CPI: Total (NSA)

-0.2%

-0.3%

1.9%

2.0%

 Total less Food & Energy

-0.2%

0.3%

2.3%

1.1%