CHART OF THE DAY: CPI Y/Y%: 2 Year Average Growth

10/14/21 08:21AM EDT

Below is a chart and brief excerpt from today's Early Look written by Macro analyst Christian Drake. 

It’s been 17 glorious months since we made the long inflation pivot and we’ve performed some commendable linguistic acrobatics in the serial attempt to re-paraphrase the same messaging for quarters as this has literally been the most asymmetric, slowest moving #StickyHigh inflationary train in a generation.  

Now, quickly, and because we’re obliged to do the bean counting, let’s both state and visual the obvious.   

  • Headline CPI = accelerating to +5.4% Y/Y = 159-month high
  • CPI, 2Y Avg Growth = accelerating +10bpst to another higher-hihg at +3.38%.  Recall, using the 2Y avg growth rate is the lowest intensity means for normalizing comp distortions and getting a clean read on underlying trend. 
  • How about actual underlying inflation … as in the series actually called “underlying Inflation” by the NY Fed and meant to reflect the broad sweep of price trends domestically.  We’ll, that accelerated again, also.
  • Underlying Inflation = +4.05% Y/Y = another Fresh RoC ATH.
  • Median CPI = accelerating +36bps to 2.78% Y/Y = the breadth of inflation is widening despite ongoing moderation in idiosyncratic Pandemic impacted series.

CHART OF THE DAY: CPI Y/Y%: 2 Year Average Growth - CoD1 CPI2Y

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