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How’s the Fed doing? The Atlanta Fed inflation dashboard has the answer.
 

For an entire year the Fed has been above its 2.0 percent inflation target in nine of nine inflation measures.

September 2025 Results

• Core CPI: 1.0 percentage points high
• FRB Cleveland Median CPI: 1.5 percentage points high
• FRB Cleveland 16% Trimmed-Mean CPI: 1.2 percentage points high
• Atlanta Fed Sticky CPI: 1.3 percentage points high
• Core PCE: 0.9 percentage points high
• Market-Based Core PCE: 0.6 percentage points high
• FRB Dallas Trimmed-Mean PCE: 0.8 percentage points high
• FRB San Francisco Cyclical Core PCE Inflation: 1.8 percentage points high
• Cyclically Sensitive Inflation: 1.0 percentage points high

Some of those are very easy measures. For example, the Dallas Trimmed-Mean PCE throws away (trims) a huge number of items on both the top and bottom end, but vastly more on the top end.

Then, based on about half the total data, calculates inflation. The result was still 0.8 percentage points over.

Alleged “market-based” measures brutally skew rent data by looking at new leases despite the fact that new leases are only 10 percent of the market.

Existing lease renewals are far more sticky. People don’t like to move. New leases are falling in some places, and the “market-based” measures pick this up.

Trimmed Mean Inflation Is the Ultimate Absurdity in Inflation Measures

On January 4, 2022, I commented Trimmed Mean Inflation Is the Ultimate Absurdity in Inflation Measures

At the time, the year-over-year CPI was 6.8 percent, the PCE was 5.7 percent, and the Trimmed-Mean was 2.8 percent.

The Dallas Fed discarded items with a combined weight of 24.07 percent off the bottom but 32.50 percent off the top end.

Ultimately, the Dallas Fed discarded 56.57 percent of the entire PCE, heavily weighted by discarding high inflation items to arrive at a preposterous 2.8 percent year-over-year measure of inflation. 

I tossed the model as totally ridiculous at that point, and have not looked at it since.

Yet, even by this nonsensical measure, the Fed is 0.8 percentage points high in 2025. I did not look to see what the Fed trimmed this time.

Market Giddy Over Tame CPI for September, But Was It Really Tame?

Earlier today I commented Market Giddy Over Tame CPI for September, But Was It Really Tame?

Tame September CPI? How Tame?

CPI and PCE Year-Over-Year Details

• CPI: 3.0 percent
• Core CPI: 3.0 percent
• PCE (August): 2.9 percent
• Core PEC (August): 2.9 percent

The actual results are much worse because of very poor CPI measures.

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