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Consumer prices fell by 0.1 percent in July as gasoline prices dropped while output at factories and housing construction posted healthy rebounds, offering hope the economy has escaped this summer's "soft patch." The Labor Department said Tuesday that the decline in its closely watched Consumer Price Index was the first decrease since a 0.2 percent drop last November. The CPI had been up 0.3 percent in June and an even sharper 0.6 percent in May, reflecting big jumps in energy costs. Meanwhile, the Federal Reserve reported that output at the nation's factories, mines and utilities rose by 0.4 percent in July, nearly erasing a 0.5 percent plunge in June. The increase was led by a sharp 1.2 percent jump in mining activity, a category that includes oil production, and a 0.6 percent rise in manufacturing activity, the biggest increase in this category three months. [more

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