Inflation Is Up 2.8% in the Last Year

The government reported the CPI numbers for May this morning. In the last month, headline inflation is up just 0.21% while the headline core rate rose 0.17%.

Over the last year, headline inflation is up 2.80%. That’s the fastest rate in more than six years.

The core rate is up 2.24% in the last 12 months. That’s close to the fastest rate since late 2008. The current title holder is 2.33% from February 2016. We might be able to break that soon. Year-over-year core inflation has been over 3% since 1995.

Here’s the real Fed funds rate based on core inflation. The Fed funds will likely rise tomorrow by 0.25%. It looks like it will take two more hikes to bring us to 0%.

Posted by on June 12th, 2018 at 10:51 am


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