4 ms·
2.8% doesn’t seem that crazy to me? Don’t we target like 2-2.5?
by isbwkisbakadqv 1y ago
2.8% doesn’t seem that crazy to me? Don’t we target like 2-2.5?
- throw-qqqqq 1y agoIt’s the change/rise that is high, not the value itself. > The producer price index increased 0.9% from a month earlier, the largest advance since consumer inflation peaked in June 2022, according to a Bureau of Labor Statistics report out Thursday
- unreal37 1y agoA 0.9% month-over-month increase is significant.
- estearum 1y agoThe Fed targets 2% at PCE (consumer) whereas this is PPI (wholesale/producer). Not always 1 to 1 but in general you expect PPI to be a leading indicator for what's coming for PCE. Part of the attention is for sure people being vigilant to see the earliest effects of the tariffs and... here they are pretty unambiguously. The more significant concern it seems to me is the rate of increase. Nearly a full percentage point in a month seems like a lot, but I'm no expert.
- infecto 1y agoI think you mostly nailed it. I suspected this was going to happen to with this recent filing season having most companies recognize tariffs and already state they are mostly getting passed on.
- AnimalMuppet 1y agoThe question is, is that full percentage point in a month a trend, or is it a fluctuation? You can't tell much by one month in isolation, or even one month compared to the previous month. It's concerning. It's hard to say much more than that yet.
- throw0101a 1y ago2% "over the long run": * https://www.federalreserve.gov/economy-at-a-glance-inflation-pce.htm https://www.federalreserve.gov/economy-at-a-glance-inflation... * https://www.richmondfed.org/publications/research/econ_focus/2024/q1_q2_federal_reserve https://www.richmondfed.org/publications/research/econ_focus...
- nimbius 1y agoAccording to the Federal Reserve, for many years, inflation in the United States has run below the 2 percent goal. higher prices for essential items, such as food, gasoline, and shelter, add to the burdens faced by many families, especially those struggling with lost jobs and incomes. At the same time, inflation that is too low can weaken the economy. When inflation runs well below its desired level, households and businesses will come to expect this over time, pushing expectations for inflation in the future below the Federal Reserve’s longer-run inflation goal. This can pull actual inflation even lower, resulting in a cycle of ever-lower inflation and inflation expectations. The fed argues that, If inflation expectations fall, interest rates would decline too. In turn, there would be less room to cut interest rates to boost employment during an economic downturn. this economics explanation feels like gaslighting every time i hear the fed mention it. the reserve literally pushed negative rates and quantitative easing for so long that people came to expect prosperity as a feature of the economic framework of the nation, and now that we have rampant inflation that cannot be controlled by normal means (prime rate) the fed somehow wants us all to understand its our fault for enjoying affordable burger meat.
- terminalshort 1y agoIt's our fault for voting in people that can't manage a budget.
- kevin_thibedeau 1y agoGasoline prices are not higher. Above $4 was commonplace across the country 20 years ago. Now that only exists in high tax states and large metros. Gas is cheap in the US.
- jjk166 1y ago20 years ago (ie mid 2000s) was a unique time of extremely high gas prices with 2008 being the all time high both adjusted for inflation and absolute. Adjusted for inflation, oil is currently higher than any point between 1990 and 2004, and in absolute terms since 2022 its been higher than any point outside of the 2006-2014 period.
- freddie_mercury 1y agoThe target is 2%, not 2-2.5. Being off by 40% is cause for alarm in almost any circumstance.
- aaronax 1y agoThat is the rise from one year ago in the "less-volatile PPI metric that excludes food, energy and trade services". This month was a 0.6% rise. So some people might think about how more months of 0.6% rise would cause the yearly one to increase gradually, up to 7.2% eventually if there are 12x 0.6% months. That would be pretty high. And then headline figure PPI was even higher at 0.9% for the month, 3.3% year.
- hvb2 1y ago0.6% of monthly inflation wouldn't be 7.2% you can't multiply like that. So the real number would be 1.006^12=7.44% And over 7% inflation is a bit more than 'pretty high' that's getting really scary if there's no clear outside reason for it
- deleted 1y ago[deleted]
- datadrivenangel 1y ago0.9% monthly annualizes to 11.3%
- jfengel 1y agoIn November 2024, inflation was at 2.7%. Inflation for the whole year was 2.9%. The public was so incensed that they threw out the government.
- Tesl 1y agoWe all know Trump voters didn't give two shits about the price of eggs. That's not why they vote for him.
- SV_BubbleTime 1y agoIf eggs were about inflation, why did the price drop back down?
- trenchpilgrim 1y agoEgg production is seasonal, there's way more supply during summer.
- righthand 1y agoEggs are still up 200% per dozen near me.
- SV_BubbleTime 1y agoI seem to remember “inflation is transitory”, but no, eggs aren’t up. Your dollar is down.
- jfengel 1y agoI'm less concerned with Trump voters (more or less the same people keep voting for him), and more with why ~10 million people didn't vote for his opponent (who had voted for her predecessor). I don't believe it had anything to do with the price of eggs, either. That was presented as the primary reason, and it's so clearly wrong that it makes me suspicious.
- 1y ago
- xnx 1y agoThat is 40% over the target.
- IAmGraydon 1y agoI mean no offense, but it's a bit surprising that someone on HN would not understand what's wrong with this statement. It takes a very basic understanding of math to know why the YoY says very little about rapidly changing inflation metrics. MoM is what you need to pay attention to.
- micromacrofoot 1y agothat 0.8% difference is probably in the area of 100 billion dollars — nearly $300 per American in a single month!