Tuesday, December 8, 2015

How is inflation doing?

Well, headline consumer inflation (Green) is zero. The implicit price deflator (Blue)is a low as ever, 1%.  PCE says we are stable.  So, great, the economy has almost predictable prices, in the aggregate.  Price distortion is huge, bhowever,    with medical and housing showing 4% gains recently, both of which occupy a large part of the spending basket.

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