Flat consumer prices in US, during the month of November, are an evidence of inflation cooling down. It has been informed that with a drop in the energy costs, the prices of food, clothes and medical services have stabilized.

At the beginning of this year, consumers were bombarded with higher prices of gas and food items. Moreover, in the last 12 months, the prices of clothing have received major push. It has been informed that because of the increased prices of cotton, a jump in the prices of clothing was witnessed.

But as core prices slowed down recently, the prices of cotton have also lowered noticeably. There are many economists who are of the view that the inflation would be on decline by the next year. As Europe is grappling the recession and the China’s economy is growing at a slower pace, there is possibility of decline in the prices of oil and other commodities.

However, a decline in the prices of gasoline has also been witnessed. On Friday, gasoline was at $3.25 a gallon, which a month ago was $3.40 a gallon. Due to financial disturbance all over the world, the wages of American also saw a decline of 1.5%. As the wages of Americans have declined, the purchasing power of many consumers has also declined.

It has been revealed that if the inflation eases up by the next year, then the Federal Government might be launching a new bond-buying program. The Federal Government is of the view that the new bond-buying program would help in reduced interest rates. With the help of reduced interest rates, many companies and individuals would be interested in investing bond-buying program. However, some policy makers are of the view that the lowered interest rates would further increase the risk of inflation.