A collection
of inflation indicators favoured by the Bank of Canada continued to edge towards the central bank's target in August, supporting its decision to raise interest rates this summer.
The US government can only manipulate the CPI and
inflation indicators for so long before reality barges in like the preverbial 800 lb gorilla.
And the other issue is if you look at typical forward -
looking inflation indicators like the TIPS, those markets are not telling you there is some massive inflation problem just on the horizon.
Treasury price rose, pushing yields lower, on Monday even after a
key inflation indicator presented the Federal Reserve with further sign of building price pressures.
How this disinflation happened, caused a dip
among inflation indicators meaning that real wages accelerated at 2.5 % rather than 3 % which is where we were headed with a stable energy price environment.
The rebound in the yen, which has caused a de facto tightening in Japanese monetary conditions, creates a further headache for the Bank of Japan, as it continues its extensive quantitative easing program, against an economic background in
which inflation indicators have remained sluggish.
A catalyst for the recent market sell - off was fear of higher inflation, and
with inflation indicators pointing upwards, the dollar and the stock markets could be in for rough ride in the coming weeks.
One of the data releases that may well have pushed the Fed to act was the strength seen in its
preferred inflation indicator, the personal consumption expenditures price index, in January.
«While the recent downtick in growth coupled with the uptick in
various inflation indicators from wages to commodity prices, has been relatively modest, investors are now more open to the risk of stagflation than previously,» he said.
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Policy makers assume inflation will be back at its two - percent target by the middle of 2018, but said they will spend extra efforts studying price movements to get a better feel for
why inflation indicators are so weak.
Members of the Federal Reserve's Federal Open Market Committee are looking
at inflation indicators to help determine the appropriate path for policy.
Although a rise of 50bp is certainly justified by the available employment and
inflation indicators, not to mention toppy stock and real estate prices, accelerating the normalization process via Fed action may have a very unpleasant impact on investor perceptions, volatility and most important, credit spreads.
This was more hawkish than the March statement, in which the rate statement said that
inflation indicators «have continued to run below 2 percent».
Next year's ticket prices are calculated on
another inflation indicator - the retail prices index (RPI).
Maybe those folks are not paying attention to
the inflation indicators that committee members at the Fed look at.
Commodity market prices can serve as
an inflation indicator (via a commodity market index).
I think investors at the moment are going to pay more attention to
inflation indicators, consumer sentiment, and real estate price trends.
Manufacturing prices are great measures for
inflation indicators, and give online Forex traders a preceding tip about the inflation level.
Inflation indicators are used frequently when trying to predict a direction of a currency in the Forex day trading.
This inflation indicator is a good measure of the growth of a country, and informs about the possible future movements of inflation indicators.