Consumer Prices Fall for 2nd Month

The good performance on inflation in October was led by a 7 percent drop in energy prices, which followed a 7.2 percent decline in September. Gasoline prices were down 11.1 percent with natural gas and home heating oil also posting big declines.

Since peaking at a record above $3 per gallon in early August, gasoline pump prices have dropped by around 80 cents per gallon nationwide in the past three months.

Food costs edged up 0.3 percent in October as increases in beef, pork and vegetable prices offset declines in poultry and fruit prices.

Excluding food and energy, the 0.1 percent rise in the core inflation rate was the smallest since a similar 0.1 percent increase in February.

Over the past 12 months, core inflation is up by 2.7 percent, still above the Fed's comfort zone of increases in the range of 1 percent to 2 percent.