June 30, 2023

Today's PCE Inflation Report - the Fed's favorite gauge (core PCE)

The PCE Inflation report came out today, Friday 6/30/23. On the overall inflation, May (+0.1%) was a welcome low-side surprise after the sizable 0.4% increase in April (see the red bars in the below graph), while the core PCE inflation still remains high, but the downtick in May (0.3%) compared to April (0.4%) was appreciated -- 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 3 month rolling average had a nice little downturn because the big January increase (+0.6%) dropped out of the 3 month range in April.


It's still stuck at a little bit more than double the Fed's 2% target.

*********LINKS
PCE News release: http://www.bea.gov/newsreleases/national/pi/pinewsrelease.htm
. . . Current release: https://www.bea.gov/news/2023/personal-income-and-outlays-may-2023

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 June 13

For comparison purposes, here is the most recent consumer price index graph (through May, released June 13)

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)


Unfortunately the CORE CPI shows the same stubborn stickiness at around 0.4%/month for the last 8 months.

June 13, 2023

Graphs (the Core CPI, which traditionally is the favorite measure of the Fed, is stubbornly stuck)

though nowadays they look at things like "supercore service inflation" and core ex shelter and who knows what other series.

Edited to add Same graph as above but CPI and CORE CPI shown separately for less clutter and more clarity



Various series:

BLS CPI press release: https://www.bls.gov/news.release/cpi.nr0.htm
CPI: https://data.bls.gov/timeseries/CUSR0000SA0&output_view=pct_1mth
CORE CPI: http://data.bls.gov/timeseries/CUSR0000SA0L1E&output_view=pct_1mth

For all BLS timeseries data, one can see the index values and other periods like rolling 3 month, rolling 6 month, rolling 12 months by clicking "More Formatting Options" on the upper right and then on the page that shows up, check the various checkboxes

REAL AVERAGE HOURLY EARNINGS of production and non-supervisory workers https://data.bls.gov/timeseries/CES0500000032 ,
. . . private workers: https://data.bls.gov/timeseries/CES0500000013

CPI excluding shelter - https://data.bls.gov/timeseries/CUUR0000SA0L2
. . . FRED: https://fred.stlouisfed.org/series/CUUR0000SA0L2
. . . Table 3 has CPI ex shelter, as well as Core ex shelter https://www.bls.gov/news.release/cpi.t03.htm

Rent (SA) https://data.bls.gov/timeseries/CUSR0000SEHA
Fred: (SA) Rent of Primary Residence in U.S. City Average https://fred.stlouisfed.org/series/CUSR0000SEHA
(NSA) https://fred.stlouisfed.org/series/CUSR0000SEHA

SA = Seasonally Adjusted, NSA = Not Seasonally Adjusted