A huge drop in energy prices led to a record fall in consumer prices in November, the Associated Press reported.

According to the Labor Department, consumer prices, a measure of inflation, fell 1.7 percent, surpassing a previous one-month record decline of 1 percent in October. It is the largest drop since the government began keeping records in 1947.

The key factor in the decline was a 17 percent plunge in energy prices. Core prices, which exclude food and energy, remained steady after a 0.1 percent drop in October.

The report could encourage Federal Reserve policy-makers to cut the federal funds rate by another half-point today to try to lessen the effects of recession. The rate is currently 1 percent.

The Commerce Department also reported that construction of new homes fell 18.9 percent in November, sending construction to a seasonally adjusted annual rate of 625,000 homes. It is the slowest pace on record dating to 1959.