Friday, May 1, 2015

Inflation Keeps Puttering Along

Inflation continues to be running at barely noticeable levels. The personal consumption expenditures price index, the Fed’s preferred inflation gauge, rose just 0.3 percent in March from a year earlier, the Commerce Department said yesterday. That's the same rate of increase that we saw in February as well.

Other measures looked a bit higher, but not extraordinarily so. Excluding the volatile food and energy categories, prices climbed 1.3 percent in March from a year earlier, the fourth consecutive month at that rate.

This has been going on for a really long time now. March was the 35th consecutive month that inflation has undershot the Fed’s stated inflation goal of 2 percent. We haven't had a month with the personal consumption expenditures index above 2 percent since May 2012.

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