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PCE inflation was a mixed bag in December

Published on 17 Comments on PCE inflation was a mixed bag in December

Our final PCE inflation reading of 2024 is a mixed bag:

Headline PCE is higher than we'd like, but core PCE is below 2%, right where we want it.

The old fashioned year-over-year measurement, which you shouldn't care about except that everyone else does, was 2.6% for headline PCE and 2.8% for core PCE. Not bad.

17 thoughts on “PCE inflation was a mixed bag in December”

  1. copans

    Do you have any idea how much large deficits increase the odds of runaway inflation occurring? Even though we haven't had hyperinflation, we would be prudent to diminish the chances of it. And my guess that % deficits do not increase the odds linearly. Hard to model this sort of thing because there are no controls and every deficit is different, but prudence suggests we should not go there.

  2. Salamander

    Apropos of nothing, I bought a dozen eggs today.

    * At one store, there were zero eggs: the shelves were bare, and signs were posted about "supply chain" problems
    * At another, eggs ranged from $6 to $10.50 a dozen.
    * At another, the range was $5.50 to $9.

    I bought a dozen cage free large brown for $6.20. Not that I listened to any of the Convict's campaign promises, but he's really failed on this one.

    1. iamr4man

      The problem is all of those DEI chickens. When I was young all you ever saw in the grocery store was white eggs, and they were plentiful and cheap. Nowadays brown eggs are everywhere and there are shortages. Use your common sense people! Time to get chickens based on merit.

          3. Salamander

            We have a friend whose chickens laid green eggs. There was always a call for "where's the ham?" whenever a green egg came out of the egg crate.

  3. skeptonomist

    If month/month inflation is better than year/year, why don't we have week/week inflation? As I keep saying, just because somebody releases a measurement every month doesn't mean that the difference over that time is fundamental or even significant. There is obviously noise in these measurements and the longer the period you average over the more noise you eliminate. You could average over any time period you like, but the year/year comparison has the advantage of eliminating seasonal variation. There are corrections for this (the usual month/month numbers are so corrected) but those corrections introduce additional errors.

    What you do not need to pay much attention to in terms of keeping informed about variation in inflation is the PCE release, which is not adding additional information to the CPI release. It just uses different weights and comes out two weeks later.

  4. Joseph Harbin

    These inflation numbers are worth bookmarking. Ditto, for other economic metrics.

    25% Canada
    25% Mexico
    10% China

    Tariffs to begin Feb 1 in retaliations for the "tens of millions" of American fentanyl deaths they are responsible for. "Promises made, and promises kept," says this week's White House press secretary. I wonder if there was a single voter who voted for Trump because he promised to impose high (and illegal) tariffs on our neighbors.

    Stock market had been having a good day.

    1. Joseph Harbin

      WTF?

      Exclusive: Musk aides lock government workers out of computer systems at US agency, sources say
      https://www.reuters.com/world/us/musk-aides-lock-government-workers-out-computer-systems-us-agency-sources-say-2025-01-31/

      WASHINGTON, Jan 31 (Reuters) - Aides to Elon Musk charged with running the U.S. government human resources agency have locked career civil servants out of computer systems that contain the personal data of millions of federal employees, according to two agency officials.

      ...The systems include a vast database called Enterprise Human Resources Integration, which contains dates of birth, Social Security numbers, appraisals, home addresses, pay grades and length of service of government workers, the officials said.

      "We have no visibility into what they are doing with the computer and data systems," one of the officials said. "That is creating great concern. There is no oversight. It creates real cybersecurity and hacking implications."

      Officials affected by the move can still log on and access functions such as email but can no longer see the massive datasets that cover every facet of the federal workforce.

      The US is totally fucked.

      ETA:
      Wired magazine published a story earlier this week on Musk's personnel changes at OPM. One new high-ranking hiree was unable to be identified by name because he had recently graduated high school and may be still a minor.

  6. Justin

    Last year the two for $6 sandwich deals at the Arby’s were common. Now they are two for $6.99! I guess we’ll see how that goes for the year. Everyone should raise prices for trump!

    Yes, I like Arby’s sandwiches sometimes. I pass it daily as there are two nearby. I see the sign advertising the deal.

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