Over the last quarter, the core index has declined at a 0.6 percent annual rate. While prices for most items in the intermediate goods indexes are flat or down, the decline in the price of construction materials and components is perhaps most noteworthy. This index has declined at a 0.5 percent annual rate over the last three months. It had been rising sharply with the housing boom at the beginning of the year, but this has now turned around. The price reports for October indicate that there is little basis for concern about inflation at present.
Prices remain well under control in almost every sector at all stages of the production process.
To date, there is very little evidence that energy price increases have been passed along to other sectors of the economy. There also is no evidence that wages have accelerated in response to either higher energy prices or low unemployment. Inflation should remain stable and low for the foreseeable future. There is no real evidence of inflationary pressures apart from the problem sectors of shelter, medical care, and education .