Consumer Prices Rise on Gasoline and Clothing

Normally in the U.S. economy, many people hear the word "inflation" and wonder how much prices will go up again....but this hasn't been the case in the recent economic situation. Deflation, or the fall of prices, is occuring more than ever and in the last months of 2008, financial analysts saw the prices going down and saw a higher risk for deflation. But, according to the Consumer Price Index, the 0.4 percent in February and 0.3 percent in January, and the core index at at a 0.2 percent increase. This applies to all things other than gas and clothing related goods, so that leaves us thinking, how will our fuel and apparel prices change in the near future?

Gas prices have recently risen 8.3 percent after a steady decrease at the end of 2008 and prices seem to possibly continue increasing in the future. Although the average price of gas right now is down to $1.92 per gallon compared to $3.28 a year ago, compared to other prices in the economy, gas is on the rise. Apparel products is the other category seeing inflation, and the apparel index rose 1.3 percent, probably from the deep discounts offered by retailers after the holidays.

Many analysts say that consumers shouldn't worry, despite the U.S. economy being at the lowest in history since the Great Depression and many think that the inflation rates will rise 0.3 to 1 percent over the next year while the economy searches for a low-point that will be the bottom of our current version of the Depression.

So what will happen to our prices in the future? Don't expect too much of a change in prices at the grocery store or at your local Wal-Mart, but as always, don't be suprised by the price at the gas pump that make make one think again about the benefits of using a bicycle.

This article can be found at : http://www.nytimes.com/2009/03/19/business/economy/19econ.html?_r=1&ref=business