Core CPI unexpectedly rose (up 0.4% month-on-month and 0.3% month-on-month), and the overall situation was consistent with the market.
figure 1: CPI overall instantaneous inflation (a=4, T=12) (black), core (sky blue), super core month-on-month (green), average month-on-month (red).instant inflation rate Eckhout(2023). Source: BLS, Federal Reserve Bank of Dallas via FRED, Bureau of Labor Statisticsand the author's calculations.
Recall that CPI inflation on average (pre-pandemic) was about half a percentage point faster than PCE inflation. In Figure 2, I plot the core indicators of instantaneous inflation, CPI and PCE.
figure 2: CPI core instantaneous inflation (a=4, T=12) (sky blue), PCE core instantaneous inflation (tan), quarterly instantaneous inflation Eckhout(2023). Sources: BLS, BEA (via FRED), and author's calculations.
Over the time period shown above, the difference was 0.44 percentage points.
