Two different forces that appear to counteract and give a nice
stable inflation figure to publish.
Not exact matches
The
figure includes the unemployment rate, the Fed's estimate of the «natural rate» — the lowest unemployment rate they believe to be consistent with
stable inflation at the 2 % target — year - over-year wage and price growth (using the core - PCE deflator, the Fed's preferred
inflation benchmark right now).
The
figure below shows some of the key indicators from the Fed's dashboard, including unemployment, the Fed's guess at the «natural rate» (the lowest unemployment rate consistent with
stable inflation), actual
inflation (PCE core, the Fed's preferred gauge), and the Fed's
inflation target of 2 percent.
The
figures showing 0.2 % growth in the core consumer price index come a day after the central bank left its monetary policy unchanged, sticking to the view that it has done enough to generate
stable inflation albeit in a slower time frame than originally set out two years ago.
We will expect the
figures to have an influence on the EUR, with any hint of a pickup in
inflation and
stable economic growth through the 1st quarter the best outcome for the EUR and those looking for Draghi to begin shifting on policy towards interest rates.
The economy, while
stable, is hardly showing great signs of life given low
inflation figures, and additional CGT taxation could put people's disposable income levels under more pressure — which will not help stimulate growth.