Blog: The Inflation Outlook Is Worse Than it Looks

The markets celebrated the PCE inflation report last week. But if we look a little more closely at the numbers, it's likely that sentiment was a little overly optimistic. I've written before about the San Francisco Fed's Cyclical/Acyclical attribution of Core (ex-Food and Energy) PCE. But the SF Fed is so inconsistent in updating this information that it can't be used reliably as a signal. After waiting almost a month to publish results for April's inflation report, they put out the May attribution almost as quickly as the headline numbers were published. Maybe they came back from vacation or something, but the new numbers continue to be troubling.