A reader writes:
I estimate (don’t kinda think) that a large portion of today’s inflation is due to environmental policies, in particular the war on fossil fuels.
A reader writes:
I estimate (don’t kinda think) that a large portion of today’s inflation is due to environmental policies, in particular the war on fossil fuels.
I gave an updated talk on this topic for the Better Policy Project yesterday. Slides available at
this link, video link below.
Back in the more innocent days of 2010, we had Sarah Palin – “Drill, baby, drill” (more innocent because folk were just circulating doctored photos of President Obama, instead of threatening to kill elected officials). Now, we have a new chorus of people asserting that allowing more permitting would relieve gasoline price pressures. Well, from the Dallas Fed (courtesy of Bruce Hall), some text in plain English.
Five year inflation breakevens have risen tightly with oil prices, while accounting for inflation and liquidity premia implies a more gradual albeit more steady increase in implied expected inflation.
The Bureau of Economic Analysis announced today that seasonally adjusted U.S. real GDP fell at a 1.4% annual rate in the first quarter. What does this portend?
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Today, we present a guest post written by Jeffrey Frankel, Harpel Professor at Harvard’s Kennedy School of Government, and formerly a member of the White House Council of Economic Advisers. A shorter version appeared at Project Syndicate.
It’s belaboring the obvious that gasoline (and energy prices) had a big impact on headline inflation [BLS release]. M/m inflation was at Bloomberg consensus of 1.2%, while core was below, at 0.3% vs. consensus 0.5%. However, it’s useful to see how over time exactly how much headline and core diverged.
Nowcasts for tomorrow’s CPI print is 1.1% m/m (Cleveland Fed), and Bloomberg consensus is 1.2%. In contrast, core CPI nowcast is 0.52%, consensus at 0.5%. The large gap is in large part attributable to gasoline prices, which rose 20% in March (all grades), even though the CPI weight of gasoline is only 3.8%. What do gasoline prices look like in April? This will depend on oil prices.
Gasoline prices have hit a new (nominal) high. The impact on the driving and the economy depends in part on the intensity of use of gasoline and diesel.