Most see inflation headed back to 2% and, at face value, inflation expectations look in line with this. Digging deeper into expectations produces a different conclusion though.... Read More
Between April 2021 and May 2022 U.S. core inflation was the highest in the developed world thanks to massive stimulus. Through April 2024, two thirds of developed countries had lower core inflation than the U.S.... Read More
In the post-pandemic economy, low-income groups have experienced inflation of roughly 2% more than high-income groups.... Read More
The implementation of monetary policy is based on assumptions. We argue the shutdown/restart of the economy in 2020 changed things. Since assumptions are inherently based on the economic environment, using pre-pandemic assumptions in a new cycle will result in a skewed perspective. ... Read More
The San Francisco Fed recently published data going back as far as 1970 delineating the difference between demand-driven inflation and supply-driven inflation.... Read More
The flexible components of inflation have helped move CPI and core CPI lower in recent months, but the sticky components remain higher than the Fed would prefer.... Read More
Demand-driven inflation has fallen seven consecutive months, but supply-driven inflation has been more static over the same period.... Read More
If current methodologies and weights were applied historically to CPI, the peak seen in June 2022 would have been much closer to the all-time highs set in 1980.... Read More
The Fed's fight against inflation will depend heavily on housing prices from here on out.... Read More
Age used to play a larger role in determining one's inflation expectations. Now that the under-40 crowd has experienced sustained inflation firsthand, this is no longer the case.... Read More
Inflation grew 1.2% in June 2022, one of the highest monthly readings ever. When this gets dropped off the year-over-year calculation with the June 2023 report, inflation bottoms around 3%. Barring any severe economic downturn or price shock, inflation is likely to rise through year-end. The Fed will find this unacceptable.... Read More
Between April 2021 and May 2022 U.S. inflation was the highest in the developed world thanks to massive stimulus. Thanks to the aggressive stance taken by the Federal Reserve, U.S. inflation is now falling faster than inflation in many other countries.... Read More
Based on different consumption baskets, middle-income households have experienced sharper rises in inflation relative to high-income households for decades.... Read More
Between April 2021 and May 2022 U.S. inflation was the highest in the developed world thanks to massive stimulus. Thanks to the aggressive stance taken by the Federal Reserve, U.S. inflation is now falling faster than inflation in many other countries.... Read More
The percentage of Fed officials reporting upside risks to inflation was slightly lower in the December Summary of Economic Projections, but this comes amidst record uncertainty.... Read More
If current methodologies and weights were applied historically to CPI, current growth rates would be much closer to the all-time highs set in 1980.... Read More
All eyes are on Thursday's CPI report as a higher-than-expected reading could keep the Fed in an ultra aggressive mindset. Here is what the market expects heading into the release.... Read More
During more tranquil economic periods, spikes in items such as crude oil or car prices are usually temporary and can more or less be ignored. Now, however, higher inflation is spreading across a growing portion of its subcomponents.... Read More
If current methodologies and weights were applied historically to CPI, current growth rates would be much closer to the all-time highs set in 1980.... Read More
A record 16 of 16 Fed officials reported upside risks to inflation in March, but this comes amidst high uncertainty.... Read More