Nowcasted PCE Instantaneous Inflation Moving Away From 2% Target

Menzie Chinn
By Menzie Chinn of Econbrowser.com
Professor of Public Affairs and Economics at the University of Wisconsin •

This article shows Cleveland Fed nowcasts of instantaneous PCE and core PCE inflation drifting away from the Fed’s 2% target in recent data, signaling inflation dynamics that may complicate policy expectations.

Board, Blackboard, Economy, Inflation, Money

Image Source: Pixabay
 

Using Cleveland Fed nowcasts post-CPI release:

 

Figure 1: Instantaneous inflation (T=12,a=4) for PCE (blue), core PCE deflator (red), all in decimal form %. December observations are nowcasts as of 2/13 from Cleveland Fed. Calculations per Eeckhout (2023).Source: BEA, Cleveland Fed, and author’s calculations.

More By This Author:

Core CPI At Consensus
Ten Days To 2025Q4 Advance Release: Nowcasts, Forecasts
“Liberation Day” Interpreted Through The Lens Of The Benchmark Revision

More from this Author

Pecking Order And AI Capex Spending

Pecking Order And AI Capex Spending

Menzie Chinn •
“Core GDP” And AI Related Imports And Investment Contribution To GDP

“Core GDP” And AI Related Imports And Investment Contribution To GDP

Menzie Chinn •
AI Related Imports Flattens Out, Investment Decelerates

AI Related Imports Flattens Out, Investment Decelerates

Menzie Chinn •

Comments

Back to all articles