Falling gasoline prices played a key role in the cooling inflation numbers for November, which were released Tuesday morning.
The latest Bureau of Labor Statistics data shows the Consumer Price Index (CPI) rose 3.1% year over year in November, a slight deceleration from October's 3.2% annualized increase, according to the latest Bureau of Labor Statistics data.
“The energy index fell 2.3% over the month as a 6.0% decline in the gasoline index more than offset increases in other energy component indexes,” said the BLS press release.
Gas prices, which were the biggest month-over-month decliner within the energy category, have been dropping since the late-summer surge, with last month's CPI posting a 5% decline.
Compared to a year ago, energy is down. Gasoline prices, natural gas prices, and fuel oil have decreased by 8.9%, 10.4%, and 24.8%, respectively.
While falling energy prices slowed CPI growth, the cost of shelter offset energy's price declines, pushing the entire index up 0.1% between October and November.
Meanwhile "Core" inflation, which strips out the volatile costs of food and energy, showed prices rose 4.0% over the prior year in October. Core inflation also notched an annual 4.0% reading last month, making Tuesday's reading the first time this year that the gauge did not fall in subsequent readings.
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According to AAA data, gas is cheaper than it's been all year. The national average of gasoline sat at $3.14 per gallon on Tuesday, down from $3.37 a month ago.
"We've seen oil prices slide over the last week, and they're taking gasoline and diesel down with it. So across the board energy is getting cheaper for the consumer," Andy Lipow of Lipow Oil Associates told Yahoo Finance last week.
The declines came despite a deepening of production cuts announced by OPEC+ delegates earlier this month.
On Tuesday, West Texas Intermediate (CL=F) fell by more than 2%, trading just below $70 per barrel. Brent (BZ=F) crude was also lower hovering above $74.50 per barrel.
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Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on Twitter at @ines_ferre.
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