The December Personal Income and Outlays report was published today by the Bureau of Economic Analysis. The chart below shows the monthly year-over year change in the personal consumption expenditures (PCE) price index since 2000. I’ve also included an overlay of the Core PCE (less Food and Energy) price index, which is a key measure watched by the Fed as a gauge of inflation.
The Headline PCE index has increased slightly in its annualized rate from 1.1% to 1.2% over the past month. The Core PCE index, however, has dropped from 0.8% to 0.7%, which is the lowest annualized rate in the 51-year history of this data series.
For a long-term perspective, here are the same two metrics spanning five decades.
(Note: I use the data from Table 9 in the full release and tables available here.)
Doug Short Ph.d is the author of dshort.com.
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