Monday, February 1, 2016

FRED® Blog — Four shades of inflation risk

The St. Louis Fed recently released a price pressures measure that calculates, among other things, the likelihood inflation will run above 2.5% over the next year. Related measures capture probabilities for deflation and lower inflation—between 0% and 1.5% and between 1.5% and 2.5%. By the way, the relevant index is not the consumer price index (CPI), but rather the personal consumption expenditures price index (PCEPI), which is used by the Federal Reserve for its 2% inflation target. Take a look at this Economic Synopses essay for more details.…
FRBSL — The FRED® Blog
Four shades of inflation risk

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