State Street says it has recorded the largest ever decline in US prices for April, with significant falls in transportation and clothing prices. “While not all prices are collapsing, it was enough to send the annual rate of inflation back into negative territory for the first time in four years, says Michael Metcalfe, global head of Macro Strategy at State Street Global Markets. “The robust readings in food prices may still reflect shortages and stock piling, but the rising prices in household equipment, recreation and leisure goods suggest deflation has not yet become broadly entrenched. With this in mind, despite deflation returning to the headlines, the risks of a deflationary spiral are more illusory than real at this moment in time.”

Source: The Standard May 13, 2020 13:52 UTC