Inflation During & After The Pandemic

Check out the accompanying pdf and chart collection. Executive Summary: The inflation problem of recent years has proven to be transitory for consumer goods but persistent for consumer services. Even so, overall inflation has been moderating this year. In our soft-landing economic scenario (60% odds), we see the PCED rate falling into the 3.0%-4.0% range over the remainder of 2023 and below 3.0% in 2024 and 2025. Consumers’ inflation expectations aren’t so sanguine. In advance of this week’s inflation reports, we review recent developments on the inflation front. … Also: Wage inflation has been moderating too, but it’s still higher than Fed Chair Powell would like to see.