Keybridge U.S. Inflation Momentum Monitor: August 2011
Index suggests that U.S. headline inflation should ease in coming months.
The Keybridge Research U.S. Headline Inflation Momentum Monitor held steady at +15.0 from July to August, and the six-month moving average declined 7.4 points to +34.5. There were no major movements in the U.S. Core Inflation Momentum Monitor as the Index increased slightly from +18.8 in July (revised) to +19.7 in August, and the six-month moving average declined slightly from +20.2 to +18.9.
As lower oil prices work through the system, we expect that headline inflation will ease over the coming months. Notwithstanding another spike in oil prices, our predictive model of the “states of inflation” indicates a high likelihood that headline inflation will decline to the historical average (about 3%) in the next several months. There is still minor pressure on core inflation levels, which we expect will remain near current levels.
Note: Past editions of the U.S. Headline & Core Inflation Momentum Monitors are published for illustrative purposes only. For more information on regular subscriptions, please contact Keybridge Research.
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