Consumer prices dipped unexpectedly in March, leaving prices over the past year falling at the fastest clip in more than a half-century. The recession is expected to keep a lid on inflation as widespread layoffs dampen wage pressures and weak demand keeps companies from raising prices. Consumer prices edged down 0.1% last month as a drop in energy prices offset a huge rise in tobacco prices, the Labor Department said.
It was a better performance than the 0.1% rise in the Consumer Price Index that economists had expected. Over the past 12 months, consumer prices have fallen 0.4%, the first 12-month decline since a similar drop for the year ending in August 1955.