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Independent Inflation Gauges Begin to Move Higher

Recent readings on some widely followed independent inflation gauges show low historical levels of inflation, but a clear change from the recent disinflationary trend.  Let’s review a few of the gauges.

According to the ECRI their US inflation gauge moved to a year over year reading of 3.5% in September:

U.S. inflationary pressures were higher in September, as the U.S. future inflation gauge climbed to 103.4 from an upwardly revised 101.0 in August, originally reported as 100.6, according to data released Friday morning by the Economic Cycle Research Institute.

“The USFIG jumped in September to an 18-month high,” ECRI Chief Operations Officer Lakshman Achuthan said in a release. “Thus, U.S. inflation pressures have moved up a notch.”

 

The latest Billion Prices Index showed a slight uptick to just under 2:

 

My Housing Adjusted CPI is telling a similar story at 1.6%:

The official BLS report showed inflation at just 1.7% last month, but it’s important to bear in mind that inflation has averaged about 3.5% per year since the BLS began tracking this data.  The independent gauges all confirm the BLS data and even though the trend appears to have changed it’s safe to say that inflation remains historically low.

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