Deflation still haunts the American landscape and until the threat subsides there will be no rest for anxious investors. But maybe, just maybe, the anxiety level will drop a notch or two with this Friday’s update on consumer prices.
As we’ve discussed in recent months, including here, the perils of falling prices is upon us. In December, the CPI posted its first annual decline since 1955. Nipping the deflationary problem in the bud is second to none as a national economic priority and the Federal Reserve, Congress and the White House are on the job of trying to stabilize if not lift prices. Helping the cause is the mixed pricing trend in energy last month.