Thursday, November 16, 2006

Inflation

by Bill McBride on 11/16/2006 12:28:00 PM

The following graph shows monthly CPI, Core CPI (CPI less food and energy) and median CPI from the Cleveland Fed.

Click on graph for larger image.

Monthly CPI is a very noisy series and that is why many people use Core CPI. Personally I prefer the Cleveland Fed's median CPI. For October, the median CPI increased 0.3% or at an annualized rate of 3.65%.

Over the last 12 months, the median CPI has increased 3.6%, and over the last 6 months, median CPI has increased at a 4.0% annualized rate. Although the inflation news is welcome, I don't think the CPI or PPI numbers will change the Fed's view.

For more, see Kash's Inflation Update, October 2006