Alternative Inflation Measures for January 2022

As promised, month on month for CP chained, sticky price (posted 50 min ago), trimmed and PCE deflator.

Figure 1: Month-on-month inflation of CPI (blue), chained CPI (brown), 16% trimmed CPI inflation (red), sticky price CPI inflation (green), personal consumption expenditure deflator inflation (black), all in decimal form (i.e., 0.05 means 5%).  Chained CPI seasonally adjusted using arithmetic deviations (brown). NBER defined recession dates (peak-to-trough) shaded gray. Source: BLS, BEA, Atlanta Fed, NBER, and author’s calculations.

40 thoughts on “Alternative Inflation Measures for January 2022

  1. AS

    PCE inflation will be reported on 2/25/2022, but Bloomberg forecasts as of today indicate a m/m percent change of 0.5% for core PCE and 4.8% Y/Y. I assume these estimates may change as more economists submit entries in the next couple weeks. The results of the actual PCE core inflation most likely will be a big influence for the decision on what the fed funds increase will be at the March meeting.

    As of December 2021, PCE core continues on a linear trend stationary path since 2020m04, using a break-point unit root test.

  2. rsm

    Why not pick one, or an average, and pay that rate as interest on a Fed CBDC account? Would you save more if your CBDC account was paying you inflation?

  3. Anonymous

    I’m not so sure that attention on month to month is the best way to think of things. I mean sure, it is your most recent datum. So in a sense you have to obsess about it, your finger on the pulse. And what else to talk about…fun to talk about news, about data coming in. But also with some Bayesian reserve.

    I mean what really tells the story of 2021 was the overall year of 7% inflation, not the months below and above that. And it’s not even like there was a clear strong trend of increasing or decreasing. 2H21 was not that different from 1H21 for instance. [I think, not sure how to check.] And there was more than one peak and trough in the time series (granted, it was not a total scatter, either).

    For that matter if the number were 0.5% versus 0.6%, is it really qualitatively different? Even just rounding means those reports could be infinitely adjacent (although maybe there’s a more digits number reported? But even if it’s 0.5000 versus 0.6000, is it that spectacularly different? When you look at last year and see (annualized monthly numbers from 3% to 12%, but the year doing 7%.

  4. ltr

    February 11, 2022

    Chinese mainland reports 101 new COVID-19 cases

    The Chinese mainland recorded 101 confirmed COVID-19 cases on Thursday, with 56 linked to local transmissions and 45 from overseas, data from the National Health Commission showed on Friday.

    A total of 66 new asymptomatic cases were also recorded, and 832 asymptomatic patients remain under medical observation.

    Confirmed cases on the Chinese mainland now total 106,764 with the death toll remaining unchanged at 4,636 since January last year.

    Chinese mainland new locally transmitted cases

    Chinese mainland new imported cases

    Chinese mainland new asymptomatic cases

  5. Anonymous

    I’m more of an oil supply/demand micro guy (maybe not even that, no econ Ph.D) than a macro monetary guy. Honest, hadn’t followed the inflation kerfuffle until lately. But it does seem like some were warning about inflation in very early 2021.

    I know it’s just a NYT newspaper columnist getting clicks, but still interesting to see that the concern was already out there. And then we got a year of it (despite the comments, including here, that dismissed it in mid 2021). I mean, I know we don’t have an infinite set of Earths to do experiments with. And many different things drive the economy so hard to predict. And easy to cherrypick to support different correlations. But still, sort of interesting to see the concern was out there, early, and then what happened.

    1. ltr

      January 26, 2021

      The Biden Economy Risks a Speeding Ticket
      The administration’s proposed $1.9 trillion stimulus package may be too much for safety.
      By N. Gregory Mankiw

      You are driving down a highway you’ve never been on before, eager to get to your destination. You’re in a hurry but also want to avoid a ticket.

      One problem: You don’t know the speed limit. How hard do you push on the accelerator?

      That is roughly the question facing the Biden administration and Congress as they debate the size of the next round of fiscal stimulus. They want to reach full employment as soon as possible. But if the economy accelerates too much, they risk a speeding penalty in the form of excessive inflation.

      One thing a driver might do is recall similar highways she has been on before. If fiscal policymakers do that, some might decide against further stimulus. According to the Committee for a Responsible Federal Budget, the fiscal packages already in place, measured as a percentage of gross domestic product, are about a quarter larger than those enacted during the Great Recession of 2008. And they are being carried out much faster.

      Another thing a driver might do is look at other drivers on the road. Again, by that standard, there is no clear need for more stimulus. According to Moody’s Analytics, the fiscal packages passed in the United States in 2020 were, as a percentage of G.D.P., about as large as those in Japan and Australia and notably larger than those in Canada, France, Germany and Britain.

      But maybe those other drivers are also wondering what the speed limit is. And maybe they aren’t in as much of a hurry. Why not go faster than everyone else? After all, a rapidly moving economy benefits many people, especially those on the fringes of the labor force.

      N. Gregory Mankiw is the Robert M. Beren professor of economics at Harvard.

      1. pgl

        “But if the economy accelerates too much, they risk a speeding penalty in the form of excessive inflation.”

        If anyone has one of Mankiw’s overpriced macroeconomic textbooks, can you please see if he ever defined “excessive inflation”.

    2. Jacob Lee

      I think that if you look, you’ll always find concern that inflation is around the corner. So when it does happen, there’s always someone to point to and say, aha! maybe the worriers are on to something. And maybe they are, but the coincidence itself is not a reason to think so.

    3. JohnH

      “ But it does seem like some were warning about inflation in very early 2021.”

      And we were warned about supply chain issues at the ports in 2015…a crisis waiting to happen. And it won’t be easily resolved.

      “ Before the Biden administration was even sworn in, the ports were already in a state of chaos. It got worse throughout the year, and by the time the administration appointed its ports czar John Porcari and began looking toward emergency intervention, only minor measures were even available to remedy decades of bipartisan mismanagement.”

      1. Anonymous

        I saw the ports issue in 2015 at an industrial client. Air freighting parts from China. For a not terribly high end assembled product. Really eats up your margin. I remember the plant manager cursing the purchasing dept (which was always finding some cheaper valve in China). Said they should draw a 100 mile radius around the plant and require all supply from there.

    1. pgl

      Why did you not tell us where you got your little list of Dr. Cook’s MOST RECENT publications, which you suggested were all of her pubs? I figured it out and yes – you are a lying troll.

  6. King John's return

    PCE is the Fed’s preferred measure of inflation. If you look at a chart that indexes price levels to Jan 2019, you will see that while PCE is above the 2% trend line (Fed target) it’s flattening and should continue in that direction as supply chains improve. If you look at one-month trimmed mean PCE it’s running around 4%.

  7. pgl

    Princeton Steve the other day claimed to have a list of Dr. Lisa Cook’s publications which clearly to anyone who checked her CV would have known to be a small subset. Menzie called it a funny list. I was reading John Cochrane smear of Dr. Cook and it hit me where Stevie got his list. Just the start of this part of Cochrane’s rant:

    ‘But, to keep a blog post short, just read a selected few of the most recent publications:

    • “Can addressing inequality unleash economic growth?” (with Nela Richardson and Jim Tankersley) Business Economics 56, 5966, (2021).’

    Of course Steve dishonestly forget to tell us how he compiled his funny list. And Cochrane at least admitted this list was a few of her most recent publications.

    To be clear – Princeton Steve LIED to us. On any other blog, he would be forever banned for this dishonest smearing of Dr. Cook. At minimum. this troll owes us an apology.

  8. Jacob Lee

    Just a quick thank you for putting these month-on-month numbers out. I’m always looking forward to them.

  9. pgl

    Bernie Sanders gave a speech on the Senate floor imploring everyone to avoid a war in Ukraine. Kevin Drum covered and commented:

    I was a bit confused as to what Kevin was trying to say perhaps Kevin was a lot confused at what the Senator was saying. The comments are better than the post in this way.

    Of course it is totally up to Putin whether he invades or not. But can we tell the US politicians going all hawkish to STFU and let Biden’s team do its best to have Putin choose peace. I think this was Senator Sanders plea.

    1. Anonymous

      I don’t want a war in Ukraine either. Or in Syria, Iraq, Libya. Or in Afghanistan (just wanted OBL killed). Kind of bizarre how the fringe left and the right are reasonable here and the centrists are imperialists.

      1. pgl

        The right? Cruz wants a war badly. Now there is the Klass Klown Tucker Carlson who works for Putin. Is that who you are referring to?

          1. Barkley Rosser

            If they are islands maybe.(Hawaii once known as the Sandwich Islands, something about Pearl Harbor).

    2. JohnH

      Getting into pointless and futile wars has been a sign of US stupidity ever since WW2…Korea, Vietnam, Iraq, Afghanistan. If the “greatest military the world has ever known” can’t win against third rate, poorly armed forces, why would it ever think of tackling Russia and China? Andrew Bacevich has lots to say about this.

      Unfortunately, Americans have such short memories, that they can’t remember how poorly America fared in its latest adventures, allowing the next war to be sold as the greatest thing since sliced bread..things are sold as different now…America will prove how great it is this time. We’ll show them.

      1. pgl

        You have been away. I presume you were treated well during your visit to Moscow. Now in the real world everyone knows it is Putin and not the US who is ready to start a war. But of course you cannot say that as you work for Putin.

        1. JihnH

          This is pgl-with his usual black and white thinking…if you’re not with us, you’re against us. Classic, mindless Bush 43 thinking.

        2. JohnH

          This is pgl-with his usual black and white thinking…if you’re not with us, you’re against us. Classic, mindless Bush 43 thinking.

        3. JohnH

          “ You have been away.” No, just speechless at how economists are flailing about, trying to deal with inflation that we were constantly told was transitory.

      2. Barkley Rosser


        I hope you are aware that the US is not planning on sending any troops into Ukraine if Russia invades.

        Why are you posing a discussion about “the US getting into wars” in a case where Russia is threatening to invade non-NATO member Ukraine with the US not having any troops there and not threatening to send any in? What sort of nonsense have you been reading lately? Do you agree with Putin that there is not a separate people called “Ukrainians,” although he needs to rush in to protect the Russian speakers from those nasty people?

        1. JohnH

          “The US is not planning on sending any troops into Ukraine if Russia invades.“ Of course, Woodrow Wilson ran for re-election on the promise to keep America out of WWI. And CIA director Pompeo said, “ I was the CIA director. We lied, we cheated, we stole. It’s – it was like – we had entire training courses. It reminds you of the glory of the American experiment.” But Rosser believes US government promises!!!

          Meanwhile , Putin says “Russia is not planning on invading Ukraine.” And Ukraine’s President “ Volodymyr Zelensky of Ukraine said that the recent buildup of Russian troops around his country’s borders, while dangerous, did not present much more of a security threat than a year ago.”

          What all this war talk does is to distract from Biden’s enormous domestic problems and help people forget about his Afghanistan withdrawal fiasco.

          1. Barkley Rosser


            Right. Putin has ben building up troops along Ukraine’s borders and making lots of demands so that Biden can be distracted from his domestic problems and the messy US exit from Afghanistan. Biden had him do that. That makes a lot of sense for sure.

            Oh, and you wanted the US to stay in Afghanistan? I thought you were opposed to the US engaging in foreign wars.

    3. Barkley Rosser

      From my personal Russian source the news out of Moscow is very bad. Apparently much of the Russian media is now claiming that there are 120,000 US troops in Ukraine, along wit missiles and nuclear weapons. Needless to say this is a total lie, and one they have not even bothered to cook up some fake videos of. They are just stating it. But this could easily be a prelude to an invasion.

      I think Putin thinks he can get away with this sort of blatant lying to his people because he has seen Trump get away with his Big Lie. Not a shred of evidence to support it, and even that Arizona staged recount did not support him, but he claimed it did, and apparently a solid majority of GOPs believe it, the 2020 presidential election waa fraudulent. If Trump can get away with that, Putin can get away with this sort of lie with the Russian people, or at least some big chunk of them.

      I have also heard that apparently Xi Jinping mishandled him in Beijing. When he arrived he was shunted off to some nothing airport and there were no Chinese officials there to greet him, only the Russian ambassador. Even though they issued a joint statement, reports have Xi “skeptical of Putin’s overbearing manner and disdain for rules.” As it is, Putin is being all whiny. Here is with all these big arms, and nobody is doing what he wants. he will show all of us! I find this now very disturbing.

      1. JohnH

        Question is, what’s in it for Russia? Occupation of Ukraine would be like their Afghanistan fiasco. Having Russia try to take over Ukraine would be the US’ dream scenario that could lead to Russia’s collapse, just like many attribute Russia’s Afghanistan fiasco being a major contributor to the collapse of the Soviet Union. I see a Russian ground invasion as virtually nil. Russia has other tools…

        And speaking of Big Lies, do you think the US is telling us what’s really going on? If so, you have memory problems. Saddam—WMDs, Vietnam, etc.

          1. JohnH

            “The US is not lying here.” As if pgl has a clue…the US lies all the time, at least in foreign policy.

            It reminds me of all the hysteria surrounded the US’ imminent war on Iran in 2012…which never materialized.

        1. Barkley Rosser


          It would be terrible for Russia. But the problem is that this is a decision for Putin, not Russia. He is running the place, in case you were unaware. Do keep in mind that those who seriously challenge him end up either dead or in jail. In the case of Navalny, he is in jail because after Putin tried to kill him by poisoning him, he went to Germany, but that was against the law, so when he returned he was put in jail. Basically he was put in jail for having the nerve to get cured from being poisoned rather than just dying like he was supposed to.

          The person who is doing distracting with foreign policy is Putin. His popularity has been siiding in Russia for a long time. So he needs to distract people from economic stagnation, massive corruption, and a badly managed pandemic. This certainly does it. The problem is that an invasion of Ukraine will not be popular, in contrast to the 2014 invasion of Crimea that was.

          My wife thinks that he is being pushed into this by the Defense Minister, Shoigu, a hardliner. But this is so Shoigu can come to power after Putin is overthrown as a result of the popular unrest that would follow a Ukrainian invasion, which will indeed be a disaster for the Russian people on multiple grounds, but not because US troops will get involved, despite your fantasies of such nonsense. She may be wrong, but in fact that is more word out of Russia, lots of rumors that there is unhappiness with Putin not just ijn the population but among his inner circle of cronies, that he is very uncertain of his power, so this may be a lunging effort to assert it, which may in the end destroy it, along with much else.

          1. Barkley Rosser

            Another likely candidate to replace Putin if he is overthrown by his disgusted cronies after their fortunes get trashed dur to economic sanctions following a Ukraine invasion is the current prime minister, Mitushkin, may be more likely, especially if it is clear that the Ukraine invasion itself turns into a giant mess, which would be highly likely, in which case Shoigu would not be favored as someone pushing the invasion.

          2. JohnH

            Right. Putin, knowing the outcome of an occupation of Ukraine, does it anyway. After twenty cautious years in office, he suddenly develops a self destructive urge!

            Give me a break…

            IMO the US is crying wolf, reminiscent of the Cold War and all the BS that passed for news for 50 years. BTW did you see that Congress is proposing spending half a $Billion on anti-China propaganda? Washington is the source of a LOT of disinformation.

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