Inflation as measured by CPI increased at a 5.4% rate year-over-year last month and 0.9% month-over-month. Core inflation—without food/energy—rose 4.5% year-over-year and 0.9% month-over-month. A large part of the increase is due to cars and pandemic-affected services. 1/
Cars once again accounted for a large share of the increase. Used cars, new cars, auto parts, and car rentals together made up about 60 percent of core month-over-month inflation 2/
Prices of pandemic-affected services rose again this month and contributed 11 basis points to the core inflation increase in June. 3/
Without cars and pandemic-affected services, core inflation rose 0.22 percent month-over-month, relative to 0.28 percent in May and 0.31 percent in April 4/
The year-over-year numbers were impacted by base effects from last year, although the impact of base effects is starting to move out of the data. Starting in July, year-over-year changes in CPI will be calculated off of a price level that is above the pre-pandemic level. 5/
Controlling for base effects by smoothing across the 16 months since February 2020, the rate of CPI inflation was 3.5%. 6/
In core inflation, controlling for base effects the rate of annualized CPI inflation was 3.1% 7/
We know that the recovery from the pandemic will not be linear. The Council of Economic Advisers will continue to monitor the data as they come in. /end
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Both headline and core prices as measured by the CPI grew 0.4% from February to March, the same as the increases in the prior month, but both a tick above market expectations. 1/
Year-over-year headline inflation increased 0.3 ppt to 3.5% in March, well below its rate of 5% a year ago. Core inflation was 3.8% over the year, the same as February’s rate and down from 5.6% a year ago. 2/
Core inflation was broadly lower than it was last year at the 3-, 6-, and 12-month frequencies. For example, 6M annualized core CPI inflation was 3.9% in March, lower than the 4.6% rate in March of last year. /3
The clean energy transition is under way, creating an innovative U.S. economy powered by cheap, reliable, and secure clean energy. This transition will address the climate crisis and provide new sources of economic growth, employment, and prosperity. 1/
The United States can meet these goals by accelerating two recent developments:
1. Shift electricity generation from fossil fuels to clean energy. 2. Electrify other sectors to use clean electricity. 2/
This is a fundamental change in how energy powers the U.S. economy. Economists characterize such transitions as STRUCTURAL CHANGE: long-term shifts in an economy’s inputs, in this case from dirty to clean energy. 3/
Ch 1, The Benefits of Full Employment, dedicated to the late William Spriggs, examines the macroeconomic and labor market impacts of full employment and tight labor markets, with a particular focus on the benefits for traditionally disadvantaged workers.
Ch 2, The Year in Review and the Years Ahead, describes macroeconomic trends during 2023 and presents the Federal government’s FY 2024 macroeconomic forecast.
Prices as measured by headline CPI grew 0.4% month-over-month in February, at market expectations and above January’s 0.3% increase. Monthly core inflation in February was 0.4%, a tick above expectations and the same as in January. 1/
Year-over-year headline inflation ticked up 0.1 ppt to 3.2% in February, well below its rate of 6% a year ago. Core inflation was 3.8% over the year, a tick below January’s rate and down from 5.5% a year ago. 2/
Core inflation was broadly lower than it was last year at the 1-, 3-, 6-, and 12-month frequencies. For example, 3M annualized core CPI inflation was 4.2% in February, lower than the 5.2% rate last year. 3/
Prices as measured by headline CPI grew 0.3% month-over-month in January, a tick above market expectations and above December’s 0.2% read. Monthly core inflation in January was 0.4%, also a tick above expectations and December’s 0.3% rate. 1/
Year-over-year headline inflation continued to ease, falling 0.3 ppt to 3.1% in January, well below its rate of 6.4% a year ago. Core inflation was 3.9% over the year, still at an elevated pace, but down from 5.6% last year. 2/
Total and core inflation were both still broadly lower than they were last year at various frequencies (1, 3, 6, 12 months). For example, 3M annualized core CPI inflation was 4% in January, lower than the 4.6% rate last year. 3/
Today’s Personal Income report shows nominal personal income grew by 0.3% between November and December, a solid pace. Both headline and core PCE inflation came in at 0.2%. 1/
Aggregate nominal compensation—reflecting both the number of workers and average pay—grew 0.4% month-over-month, a solid pace in line with its pre-pandemic average. 2/
Nominal consumer spending rose 0.7% in December, above expectations and above November’s 0.4% increase. 3/