A Statistical Revamp Is About to Lower Inflation, at a Critical Time
The Federal Reserve's preferred inflation gauge is facing a statistical overhaul that may result in lower reported inflation figures.
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The brief
The Bureau of Economic Analysis is overhauling the methodology of the PCE price index. This statistical revamp is expected to result in a downward revision of the inflation gauge favored by the Federal Reserve.
Coverage from the Wall Street Journal, Seeking Alpha, and Crypto Briefing emphasizes that inflation figures may appear lower even if costs remain high. Additionally, TradingView reports that KC Fed's Schmid and Grand Island have suggested it is time to stop excluding food prices from core inflation measurements.
Future developments depend on the implementation of the new PCE price index methodology and the consideration of St. Louis Fed research regarding new ways to measure underlying inflation.
Synthesized by Archynetys from the headlines below under a strict no-invention contract. ✓ fact-checked: all claims supported by sources Updated 7h ago.
Quick answers
Which agency is changing the inflation measurement?
The Bureau of Economic Analysis is overhauling the PCE price index methodology.
What is the expected impact of this change?
Coverage indicates the revamp is set to lower the Federal Reserve's preferred inflation gauge.
What specific change to 'core' inflation has been suggested?
KC Fed's Schmid and Grand Island have stated that food prices should no longer be excluded from core inflation calculations.
Coverage (8)
- US inflation gauge set for statistical revamp Breakingthenews.net · 1d ago
- St. Louis Fed research floats new way to measure underlying inflation investingLive · 1d ago
- KC FED'S SCHMID/GRAND ISLAND: STILL THINK TIME TO STOP EXCLUDING FOOD PRICES FROM CORE INFLATION; 'CORE' SHOULD BE CHANGED TradingView · 1d ago
- Why Inflation May Suddenly Look Better Even Though Everything Still Costs More 24/7 Wall St. · 1d ago
- St. Louis Fed research floats new way to measure underlying inflation TradingView · 1d ago
- Bureau of Economic Analysis overhauls PCE price index methodology, potentially lowering the Fed's preferred inflation gauge Crypto Briefing · 1d ago
- Fed’s preferred inflation gauge set for downward revision Seeking Alpha · 1d ago
- A Statistical Revamp Is About to Lower Inflation, at a Critical Time WSJ · 1d ago
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