Since Powell flagged core services ex-housing as an important subset of inflation (a potential proxy for wage-price passthru), it got a lot of attention yesterday.
Plus, it was better behaved in Dec at 0.28% (+2.9% at a 3-month annual rate vs 5% in Nov.)
Plus, it was better behaved in Dec at 0.28% (+2.9% at a 3-month annual rate vs 5% in Nov.)
But as FHN’s Jim Vogel (and others) pointed out, measures of core services—with or without housing—show headline figures could overstate the degree of improvement in the data
Consider: Powell cited core *PCE* services ex-housing (Dec PCE is out Jan 27) federalreserve.gov
Consider: Powell cited core *PCE* services ex-housing (Dec PCE is out Jan 27) federalreserve.gov
If you exclude health insurance (PCE calculates it differently) and airfares, the remaining services inflation was 0.5% in Dec vs 0.4% in Nov.
While unlikely to reshape the debate on 25 v 50 in Feb, it's why some could be less giddy than others have been on the services number
While unlikely to reshape the debate on 25 v 50 in Feb, it's why some could be less giddy than others have been on the services number
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