Global| Mar 18 2002PCE Price Deflator Subdued
by:Tom Moeller
|in:Economy in Brief
Summary
The PCE Chain Price Deflator recently has been quite subdued relative to the Consumer Price Index. Last year, the difference between growth in the two indexes less food & energy jumped to 1.1 percentage points. The primary difference [...]
The PCE Chain Price Deflator recently has been quite subdued relative to the Consumer Price Index. Last year, the difference between growth in the two indexes less food & energy jumped to 1.1 percentage points.
The primary difference between the two series is their different weighting schemes. The PCE deflator published by the Bureau of Economic Analysis updates the weights assigned to each spending category each month as spending patterns change. The CPI published by the Bureau of Labor Statistics holds constant the weights that are currently based on the Consumer Expenditure Survey over the years 1999 and 2000.
The Bureau of Labor Statistics will begin publishing a Chained CPI effective with release of July data in August 2002. Designated the C-CPI-U, the index will supplement the existing indexes already produced by the BLS.
For more information on the upcoming CPI release go to http://www.bls.gov/cpi/superlink.htm
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
More Economy in Brief
