Peter Smith
In the data from Truflation, US consumer inflation is 1.76% for the year. By comparison it was 1.84% on the previous day. For those prices there is a small reduction.
To explain this change, costs are lower for food that people buy away from home and for restaurant meals. And there is a lower price for gasoline.
On the website of Truflation, the estimate is in real time and is much lower than the official CPI from the Bureau of Labor Statistics. At this time the CPI is 3.30%.
With a difference of almost 1.5 percentage points, it is clear that data from traditional sources is slower than price changes that happen in real time. If the official CPI moves lower in the same way, the Federal Reserve might decide to keep interest rates low or lower them in future meetings.
As the latest data shows, prices are becoming stable more quickly than the main numbers show - this is true for energy and for items that consumers buy.
Because of this difference, people might expect the Federal Reserve to act with less restriction if the official inflation numbers move down. It is likely that inflation is moving down at a faster rate than the official statistics show.
Peter Smith
