Consumer Prices drop due to drop in oil prices?

by **burtonridr** » Tue 16 Sep 2008, 10:05:01

Why is this? Why is oil price dropping?

Does it have to do with the value of the dollar?

WTF?

I dont understand how oil can continue to drop despite supply problems.

Oh wait.... I remember someone talking about how the price of goods will not be affected by the price of oil for months, are we now seeing a dip in consumer prices following the dip in oil prices we were seeing?

$this->bbcode_second_pass_quote('', 'W')ASHINGTON - Consumer prices in August posted the first monthly decline in nearly two years as Americans finally get a break from surging energy prices.
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The Labor Department reported Tuesday that consumer prices edged down 0.1 percent last month, a significant improvement from a 1.1 percent price spike in June and a 0.8 percent rise in July. The cost of gasoline and other fuels have plunged, reflecting big drops in crude oil prices.

The decline, which was in line with expectations, may give the Federal Reserve the room it needs to cut interest rates if Fed officials feel a rate reduction could help stabilize turbulent financial markets.