CERF Blog

Written October 21, 2022 The fundamental question for the U.S. macroeconomic forecast is if the pandemic recovery can continue or if the economy is heading into a recession. This outcome will be determined largely by Federal Reserve actions during the quarters ahead. Given how long the Fed waited to fight the current bought of inflation,… Read more

Previously published September 28 in the “California Economic Forecast”: The saga of the Great Recession continues. Over six million people have been unemployed for more than 27 weeks, and job growth may be slow enough in the next few months that the unemployment rate rises again. Major revisions to GDP, released in late July, show… Read more

Recent data releases show that inflation remains well contained. In fact, by one key measure, inflation is at a historical low, causing increasing concern about deflation. From the March Consumer Price Index press release we see that first quarter overall price levels have grown about 2.3 percent from 2009 quarter 1. This measure includes energy… Read more

Prices The January Producer Price Index (PPI) data released yesterday February 18, appeared to show that price pressures were building up again with finished goods prices rising 4.6 percent over 12 months ago, and rising 1.4 percent over the prior month. The January Consumer Price Index (CPI) data, released today, showed that the all-items inflation… Read more

Most people are concerned about potential inflation, but deflation is the immediate worry. It is easy to see why the concern for inflation. Big deficits and big increases in the monetary base usually lead to inflation. However, inflation is not inevitable. For inflation to occur, increases in the monetary base have to be translated to… Read more