Prices in the US fell in the year to March, marking the first annual decline since 1955, while there were further signs that the pace and severity of the US downturn is easing in some sectors.

Consumer prices fell 0.4 per cent over the year to March, the labour department said yesterday, and dipped 0.1 per cent last month from February owing to weak energy and food prices. The drop in prices has lessened pressure on consumers who have seen their wealth savaged by the recession.