Introduction to Underlying Inflation Measures
The concept of underlying inflation measures is crucial in understanding the economy’s inflation trends. These measures help separate the actual inflation signal from the noise caused by relative price changes, making them good predictors of future inflation. They also gauge price pressures in the economy by comparing alternative price statistics to their price-stability targets.
What are Underlying Inflation Measures?
Underlying inflation measures are statistical tools used to analyze and predict inflation trends. They include various price indices, such as the Consumer Price Index (CPI) and the Personal Consumption Expenditures (PCE) price index. These measures are essential in understanding the economy’s inflation dynamics and making informed decisions about monetary policy.
How to Read the Underlying Inflation Dashboard
The Underlying Inflation Dashboard is a tool that provides a comprehensive overview of various inflation measures. The dashboard is divided into sections, each showing a different aspect of inflation. The first section displays the 12-month growth rate of each underlying inflation measure, compared to its price stability target. The measures are color-coded to indicate whether they are within their target range or not.
Understanding the Color Codes
The color codes used in the dashboard are as follows:
- Measure is within target range (-/+0.25 from target)
- Measure is between 0.25 and 0.50 ppt below target
- Measure is more than 0.50 ppt below target
- Measure is between 0.25 and 0.50 ppt above target
- Measure is more than 0.50 ppt above target
Frequently Asked Questions
Why are Underlying Inflation Measures Helpful?
Underlying inflation measures are helpful because they separate the inflation signal from relative price noise, making them good predictors of future inflation. They also help gauge price pressures in the economy by relating the position of a given alternative price statistic to its price-stability target.
How are Price-Stability Targets Estimated?
The price-stability targets are based on the relationship of their corresponding price statistics to core PCE inflation. The choice for each measure’s price stability target is somewhat arbitrary, but given the primacy of core PCE inflation in the communications of the Federal Open Market Committee and the Federal Reserve, the targets are expressed as 2 percent plus the average difference with core PCE inflation over the past decade.
How to Navigate the Underlying Inflation Dashboard
To navigate the dashboard, click on the name of a data series in the table to view a time-series line graph and a link to the data source. The dashboard is updated twice a month, after the release of CPI inflation data and after the release of the Personal Income and Outlays report.
Data Frequency and Updates
All nine data series in the dashboard are monthly. The dashboard is updated twice a month, with the date of the last update posted in the top right corner of the Underlying Inflation Dashboard’s home page.
Using the Dashboard Content
You are welcome to use Underlying Inflation Dashboard content, as long as you attribute it to the Federal Reserve Bank of Atlanta and send a copy of the reproduced content. Please see the Disclaimer and Terms of Use for more information.
Finding Underlying Data
To find the underlying data for a given data series, click on the source line at the bottom of any historical line graph to navigate to the source’s web page.
Contact Information
If you have a question or suggestion about the Inflation Dashboard, please click here to share your thoughts. The Federal Reserve Bank of Atlanta welcomes feedback about the dashboard.
Upcoming Releases
The following table shows the upcoming releases of inflation data:
| Release | Date of release |
| Consumer Price Index | 1/15/2025 |
| Personal income and outlays/PCE price index | 1/31/2025 |
| Consumer Price Index | 2/12/2025 |
| Personal income and outlays/PCE price index | 2/28/2025 |
Conclusion
In conclusion, underlying inflation measures are essential tools for understanding the economy’s inflation trends. The Underlying Inflation Dashboard provides a comprehensive overview of various inflation measures, helping users gauge price pressures in the economy. By understanding how to read the dashboard and navigate its content, users can make informed decisions about monetary policy. The dashboard is updated regularly, and its content can be used with proper attribution. If you have any questions or suggestions, please do not hesitate to contact the Federal Reserve Bank of Atlanta.
