Consumer Prices Plunging
Consumer prices dropped by 1.9 percent last month, the biggest single-month decline since the Great Depression, the Labor Department reported Tuesday.
The decline was driven by lower energy prices, with gas prices falling by 29.5 percent in November, the report said. Gas prices have now dropped by 47 percent from a peak five months ago. Prices for home heating oil and natural gas were also down.
Excluding food and energy prices, and despite declines in hotel and car prices, so-called core consumer prices were unchanged, the report said.
According to the National Federation of Independent Business, small-business owners continued to slash selling prices in November in an effort to lift sagging sales and earnings.
"Pricing power has vanished and reports of sales declines are at record high levels," William Dunkelberg, the Washington-based small-business lobby group's chief economist, said in a statement. "Profits can't improve in this environment," he said.
Meanwhile, a sharp downturn in housing starts and residential construction last month continued to hammer the nation's housing market, the Commerce Department reported this week. There were just 625,000 privately-owned housing starts in November, an 18 percent drop from October and roughly half the amount from the some period last year, the report said.
About a third of the nation's small businesses are financed by home equity loans.