Tag Archives: consumer inflation

Continuing accelerated consumer inflation points to sharp slowdown, but no recession imminent Inflation, along with the expiration of the emergency pandemic payments, is one of the two big threats to this expansion. This morning’s report on consumer inflation for September, at 0.4%, was certainly elevated compared with its typical pre-pandemic reading of 0.2%/month, but on the other hand was the third month in a row of sharp deceleration from...

A more “normal” consumer inflation reading for August belies damage to the economy going forward Inflation, along with the expiration of the emergency pandemic payment, is one of the two big threats to this expansion. This morning August consumer inflation was the lowest in 6 months, up only 0.3% – within the range of a normal reading in normal times. Since wages increased 0.5% in August, this means that real wages increased. Let’s take a...

Here is my inflation worry by New Deal democrat I want to follow up on a comment I made yesterday in connection with Wednesday’s consumer price report. It is certainly true that *inflation* is likely to be transitory. The 5.3% YoY inflation we’ve seen in June and July may certainly pass in the next few months and reduce to a more somnolent number under 3%. Hoorah! Inflation was transitory! But what if the price increases “stick?” In...

July consumer inflation: the spike subsides somewhat, but we are close to the limit of “transitory” For the last two months, my theme has been that if the spike in inflation only lasted two or three months, it was not a big deal, but if the trend were to continue longer, it would begin to impact consumer spending, and it will get the Fed’s attention. In that regard, the “good” news is that in July consumer inflation was “only” 0.5%. The bad...

Consumer inflation rises the most in over a decade; will it draw the Fed’s attention? Let me start my take on this month’s inflation report with my concluding remarks last month: “this is not a big deal if it only lasts another month or two. But if the trend continues longer than that, it will begin to impact consumer spending, and it will get the Fed’s attention.” Well, it has definitely lasted another month. In spades.  The 0.9% increase in...

February consumer inflation begins to heat up a little Seasonally adjusted consumer prices rose 0.4% in February. As a result, over the past several months there has been a significant uptick in YoY inflation to 1.7% from 1.1% in November.  Aside from the pandemic, for the past 40 years, recessions had happened when CPI less energy costs (red) had risen to close to or over 3%/year, usually driven by increases in the price of oil by more than...