U.S. inflation remains above Fed's target rate
Source: UPI
April 28 (UPI) -- Inflationary strains on the U.S. economy eased somewhat in March, though it remains above the 2% target rate for the Federal Reserve, the Commerce Department reported Friday.
The new data show personal income levels increased by 0.3% from February to reach $67.9 billion, suggesting wage growth remains resilient against lingering inflationary strains.
Those strains, however, are easing. Total personal consumption expenditures, a spending metric that serves also as the Federal Reserve's preferred measure of inflation, was 4.2% annually to March, lower than the 5.1% level for the 12-month period to February.
Stripping out more volatile items such as food and energy, however, and prices barely moved. Those prices increased by 4.6% over the 12-month period to March, near the level that's existed since at least November.
Read more: https://www.upi.com/Top_News/US/2023/04/28/pce-personal-income-inflation-fed/3031682689916/
From the source -
Link to tweet
@BEA_News
·
Follow
Get details and charts on people’s income, spending, and saving in March in our latest blog:
https://bea.gov/news/blog/2023-04-28/personal-income-and-outlays-march-2023
Image
9:16 AM · Apr 28, 2023
Release - https://www.bea.gov/news/2023/personal-income-and-outlays-march-2023
= new reply since forum marked as read
The PCE Inflation report came out today, Friday 4/28/23. It was good on the overall inflation (see the red bars in the below graph), but the core PCE inflation still remains high, and has not come down much in recent months -- see the blue bars.
The Federal reserve's favorite inflation gauge for projecting FUTURE inflation has been the core PCE (which is the PCE less food and energy). It's not that food and energy are unimportant, but are quite volatile from month to month. The core measure is thought to be better for projecting trends into the future.
Below is the CORE PCE inflation trend -- the rolling 3 month average and the rolling 6 month average
The rolling 3 month average should improve quite a bit next month when the January +0.6% number falls outside the 3 month period.
*********LINKS
PCE News release: http://www.bea.gov/newsreleases/national/pi/pinewsrelease.htm
The above shows the last 5 months. I found the latest 12 months (and way beyond) at FRED:
PCE: https://fred.stlouisfed.org/series/PCEPI
CORE PCE: https://fred.stlouisfed.org/series/PCEPILFE
The rolling 3 month and 6 month figures are calculated from the index values from the above FRED series for the CORE PCE (not from doing one digit math averages).
Consumer Price Index (CPI) released April 12
For comparison purposes, here is the most recent consumer price index graph (through March, released April 12)
CPI - https://data.bls.gov/timeseries/CUSR0000SA0&output_view=pct_1mth
CORE CPI - http://data.bls.gov/timeseries/CUSR0000SA0L1E&output_view=pct_1mth
(Choose "More Formatting Options" at the upper right of the page for other views such as rolling averages of past 12 months, past 6 months, past 3 months)
Inflation measures - last 3 months annualized
. . REGULAR CORE
PCE 4.00% 4.85%
CPI 3.82% 5.11%
PPI -0.28% 3.61% (Producer Price Index, aka Wholesale Prices)
Cooling wholesale prices should ideally be reflected in the PCE and CPI in the next month or two, but seems not to be that good of a predictor.
Interestingly it says that rents carry twice the weight in the CPI as in the PCE.
This is an excellent summary not only of the PCE inflation report that came out today, but also of the Employment Cost Index and the Personal Income and Personal Consumption Expenditures (consumer spending) reports that were also released today.
Here are some excerpts from the inflation part --
The index, which excludes volatile food and energy costs to capture “core” prices, rose 0.3% from February to March and 4.6% from a year earlier — still far above the Fed’s 2% target rate. Some Fed officials are concerned that core inflation hasn’t declined much since reaching 4.7% in July.
Overall prices ticked up just 0.1% from February to March, the smallest monthly rise since last July and down from a 0.3% increase from January to February, Friday's Commerce Department report showed. Compared with a year ago, inflation slowed to just 4.2% from 5% in February, though much of that decline reflected lower gas prices. That is the lowest year-over-year overall inflation figure in nearly two years.
The Fed is thought to monitor the inflation gauge that was issued Friday, called the personal consumption expenditures (PCE) price index, even more closely than it does the government’s better-known consumer price index. Typically, the PCE index shows a lower inflation level than CPI. In part, that’s because rents, which have been among the biggest drivers of inflation, carry twice the weight in the CPI that they do in the PCE.
The PCE index showed that food prices dropped 0.2% from February to March. Gas costs plummeted 3.7%, which partly reflected seasonal changes. Prices at the pump have since increased in many states.
The latest inflation figures point to the dilemma confronting officials at the Federal Reserve: Across the economy, price increases for many goods have slowed significantly. And some previous drivers of inflation, notably clogged supply chains, have eased. Yet prices for many services, including restaurants, auto insurance and hotel rooms, are still surging, fueled by robust demand from consumers who in many cases have enjoyed rising wages.
Last edited Tue May 2, 2023, 11:48 AM - Edit history (4)
Consumer Sentiment, and PCE inflation.
I'll be particularly interested in looking at the Employment Cost Index as it is said to be a much better indicator of wages and compensation than the usual go-to metric of average hourly earnings that comes out on first Fridays (usually). The ECI is said to looks at trends in the same occupations, whereas average hourly earnings gets distorted by job losses or gains occurring in certain sectors more than others; last hired first fired stuff (in the pandemic that caused the averages to soar). Whatever. I'm saying this off the top of my head, there are better explanations out there.
The downside of the ECI is that it's quarterly - meaning a long wait for updates, and then the updates have some old data in them.
The AP story I linked to has just this on today's ECI report:
That looks good because the CPI rose 0.94% in the last 3 months, and the PCE 0.98%. So that means an actual real (inflation-adjusted) increase, for a change.
http://www.bls.gov/news.release/eci.nr0.htm
Their table shows the 12 month inflation-adjusted number is -0.2%. At a glance I don't see their inflation-adjusted 3 month number anywhere.
==================================================================
From: https://www.piie.com/blogs/realtime-economic-issues-watch/us-wages-grew-fastest-pace-decades-2021-prices-grew-even-more
By fixing workforce composition, the ECI provides a more accurate picture of what is actually happening to wages.
[1] The Pandemic’s Effect on Measured Wage Growth, The WHite House, 4/19/21
https://www.whitehouse.gov/cea/written-materials/2021/04/19/the-pandemics-effect-on-measured-wage-growth/
=====================================================
This particular one is inflation-adjusted wage and salaries for private sector workers.
Note the build-up to the Q2.2020 peak. Then it plateaued through Q1.2021, President Biden's first quarter, then went down.
Finally it has been turning up since a local bottom in Q3.2022 for a couple of quarters.
The last reading is 3.7% below the peak, and 3.4% below the Q1.2021 value.
Source: https://fredblog.stlouisfed.org/2018/02/are-wages-increasing-or-decreasing
I tediously moused over point by point gathering the data from their graph (the numbers for each point pop up, so I didn't have to "read" the graph like back in middle school). Edit: There's a "Download data" link at the lower left of the second graph at the Source that I had been aware of and had clicked and thought it was just downloading a PDF file of the page. But it turned out it was offering to download the Excel data for the graph which is of course what I wanted. So I did that and verified that the data was the same, to within 0.0 accuracy, as used for my graph, but I went ahead and replaced my old data with it (since it has a few more digits to the right of the decimal, and heck why not).
The source link just above also compares to inflation-adjusted average hourly earnings and also to inflation-adjusted median usual earnings of full-time workers.
This (the ECI) is reportedly the Fed's favorite wage and salary indicator as explained earlier in the post.
Rate hike - right now it's an 84% probability of a quarter point rise. vs. 16% stay put. (Last night it was 87% to 13%)
https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html
=================================================
The Atlanta Fed's GDP Now model projects a 1.7% Q2 GDP (seasonally adjusted annualized rate). Today is their first forecast of Q2 GDP.
https://www.atlantafed.org/cqer/research/gdpnow
Note though that is not in any way a prediction or forecast of theirs, its just the output of a model, as they take pains to explain. Still it is what it is, such as it is 
.
Along with it is a blue chip economists' consensus forecast and the spread between the lowest 10% and highest 10% of their forecasts. Right now the median is a fraction of a tenth of a percent below 0%.
ever since 2011, after the GOP took the House back under Obama and started holding the country hostage with their debt ceiling games. The big corporations who some of the "new" loon GOP members have decided to try to buck (see DeSatan) aren't going to let it happen.
Right now, the rate is getting closer to what it was just before Obama first took office, and after he did, it was precipitously dropped as the Great Recession began -
(The current federal funds rate as of April 26, 2023 is 4.83% per here - https://www.macrotrends.net/2015/fed-funds-rate-historical-chart)
The package on the left magically turned into the package on the right yet they are priced the same.
I have done stuff like that too and agree it can be tedious and frustrating. But it will give you a more detailed and smoother result when you plot it. 
a short 
is good! 
A lot of times, they have those downloads as .CSV too but I know I ended up buying a standalone "Student" copy of M$ Office (also have LibreOffice on another machine) to get Excel for the .XLS files. When I was still working, I lived in spreadsheets and way back when I had first started in the lab and a few years later, we finally got a couple 8086 PCs, we had a several programs we settled on - Lotus 123 & QuattroPro.
I know I have gotten rusty with them to generate a graph since I retired and I have saved data from stuff over the years to get it into a spreadsheet to plot but that is a "one of these days" project!
But again I agree that clearing the mind will help tease out those simpler (often common sense) solutions. 