Looking at the December release, the headline and core were slightly above the Bloomberg consensus.
figure 1: Instantaneous CPI inflation (T=12,a=4) (bold blue), instantaneous core CPI inflation (bold pink), m/m super core (light green), m/m service super core (sky blue) Color), m/m trimmed average CPI (green), monthly CPI median (dark red), all are annual rates.instant inflation rate Eckhout(2023). NBER-defined recession peak-to-trough dates appear gray. The dotted red line is an inflation rate of 2.45%, consistent with the 2% PCE deflator inflation rate. Vertical gray dotted line on Russia's expanded invasion of Ukraine. Source: BLS via FRED, Bureau of Labor Statistics, Pavel Skrzypczynskithe Federal Reserve Bank of Cleveland through FRED, NBER, and author's calculations.
Note that the instantaneous CPI inflation rate is nearly 2.45%, consistent with the pre-pandemic PCE inflation rate of 2%. Neil Owen pointed out that last year, this gap (or “wedge”) increased to about 2% annually. (The gap is less pronounced, as of November, using the instantaneous inflation rate, the gap was only about 1.2%.)
The median and average CPI inflation (annualized monthly rate) are higher than the instantaneous CPI inflation and are rising. Each of these measures has its proponents as indicators of current inflation and trends. The service super core is higher than the super core, indicating that service industry inflation remains high.
