Deflation still see the haze over Washington.

<P> Published ahead of March 8 issue of the U.S. "Business Week" entitled "Deflation: Why re-focus" the article said the United States last year, the core price index has dropped to levels fall, although this is that Wall Street spread cheer .sound, but may also signal a greater concern. .</ P> <P> 2 月 19 released the latest inflation data as investors excited. .Despite the expenditure of petrol and other energy products increased, but the consumer price index in January rose only 0.2%. .Perhaps, more importantly, the core consumer price index (which excludes volatile food and energy prices) fell 0.1% in the month. .The news of the Fed to calm the financial markets will be forced to raise interest rates to curb inflation concerns. .</ P> <P> investors will be well curb their enthusiasm. .Just disappeared for a few months, analysts began talking about "D" at the beginning of that word (Defla-tion, deflation). .Deflation, or even just the initial impact, are scary. .Once the general decline in prices, the economy becomes more sluggish. .Face the prospect of lower prices, the company can expand its business, or recruit additional staff. .</ P> <P> In addition, deflation, Federal Reserve Chairman Ben Bernanke will and his colleagues is difficult to deal with. .The more prices fall, the inflation-adjusted real interest rates will be higher, thus further reducing corporate and consumer borrowing will. .January U.S. consumer price index fell, leading to the core consumer price index since last October and has been essentially unchanged. .Over the past year, the increase of only 1.6%, well below the 10 year average of 2.2%. .</ P> <P> housing expenses, primarily rent or expenses arising from the residence, has become a major factor in inflation. .This is not surprising, since they account for the consumer price index of about 1 / 3. .Some analysts believe the real estate bubble burst and its subsequent impact, resulting in inflation has been distorted downward. .</ P> <P> not just housing costs make the price down. .In the United States Government to formulate the personal consumption expenditure price index, 44% of the products and services are in decline last December. .Housing costs in the CPI index is the proportion of relatively smaller, so the Federal Reserve that it can more accurately measure inflation. .</ P> <P> culprit behind inflation retrograde, is caused by a large decline in the overall economic decline. .Even if the economy is gradually recovering, this downturn will not end anytime soon. .San Francisco Fed President Janet Yellen said in 2013, the U.S. economy can fully recover potential. .</ P> <P> Even so, signs of higher inflation emerging. .China led global demand is increasing, stimulating the commodity and import prices. .U.S. firms in January rose 9.6% in raw material costs, for the most recent three years. .However, the operating costs of enterprises accounted for 2 / 3 of wages, including pensions and other benefits, it is still high unemployment rate down. .Labor costs at an annual rate in the fourth quarter rose by only 1.5%, so heavily dependent on consumer spending can not be called the strong U.S. economic recovery. .In fact, the deflation of the constituent elements remain on the table above. .</ P>.