Data for the Classroom from    Ed Dolan’s Econ Bloghttp://dolanecon.blogspot.com/   US Inflation Data:Seasonally Adjusted ...
Headline CPI Inflation Drops to Zero in April The headline number in the latest BLS  inflation report, the seasonally  ad...
Core Inflation Shows Little Trend in Recent Months Food and energy prices are volatile  and usually account for much of t...
Trimmed Mean Inflation Drops Below Core Inflation Another way to remove volatility is the  16% trimmed mean CPI published...
Which Measure is Best? The CPI for all items gives the most  accurate measure of current  changes in the cost of living ...
The Longer Term Trend To see longer term trends in  inflation, it is useful to look at year-  on-year changes, which comp...
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US Inflation Data: Seasonally Adjusted CPI Shows Zero Change in April

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US inflation, as measured by the seasonally adjusted consumer price index for all items, fell to zero in April. Other measures showed inflation at low but positive rate.

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US Inflation Data: Seasonally Adjusted CPI Shows Zero Change in April

  1. Data for the Classroom from Ed Dolan’s Econ Bloghttp://dolanecon.blogspot.com/ US Inflation Data:Seasonally Adjusted CPI Shows Zero Change in April Posted May 19, 2012 Terms of Use: These slides are made available under Creative Commons License Attribution— Share Alike 3.0 . You are free to use these slides as a resource for your economics classes together with whatever textbook you are using. If you like the slides, you may also want to take a look at my textbook, Introduction to Economics, from BVT Publishers.
  2. Headline CPI Inflation Drops to Zero in April The headline number in the latest BLS inflation report, the seasonally adjusted Consumer Price Index (CPI- U) showed zero change in April Using unrounded data and stating the monthly change at an annual rate, seasonally adjusted inflation was 0.36% Without seasonal adjustment, the CPI rose at a 3.7% annual rate in April Posted May 19, 2012 on Ed Dolan’s Econ Blog http://dolanecon.blogspot.com
  3. Core Inflation Shows Little Trend in Recent Months Food and energy prices are volatile and usually account for much of the month-to-month change in the CPI Their effect can be removed by taking food and energy out of the CPI. The result is called the core inflation rate. The monthly change in core inflation, stated at an annual rate, was 2.92 percent in April, about the same as in March. Motor fuel prices, which rose much less than usual in April, accounted for much of the difference between the all-items CPI and the core CPI Posted May 19, 2012 on Ed Dolan’s Econ Blog http://dolanecon.blogspot.com
  4. Trimmed Mean Inflation Drops Below Core Inflation Another way to remove volatility is the 16% trimmed mean CPI published by the Federal Reserve Bank of Cleveland. It removes the 8% of prices that increase most and the 8% that increase least in each month, whatever they are The 16 percent trimmed mean CPI increased at an annual rate of 1.94 percent in April, down about half a point from the March rate Posted May 19, 2012 on Ed Dolan’s Econ Blog http://dolanecon.blogspot.com
  5. Which Measure is Best? The CPI for all items gives the most accurate measure of current changes in the cost of living Economists at the Fed look closely at the core and trimmed mean CPIs to judge the effect of monetary policy on underlying inflationary trends The Fed considers inflation of about 2 percent to be consistent with prudent monetary policy Of the three measures shown, only core inflation exceeded the Fed’s target in April Posted May 19, 2012 on Ed Dolan’s Econ Blog http://dolanecon.blogspot.com
  6. The Longer Term Trend To see longer term trends in inflation, it is useful to look at year- on-year changes, which compare each month’s price level with that of the same month in the year before All y-o-y measures of inflation rates slowed during the global recession, then rose again for most of 2011. The three measures shown here have converged values just over 2 percent in 2012 as inflation has become less volatile Posted May 19, 2012 on Ed Dolan’s Econ Blog http://dolanecon.blogspot.com

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