by William J. Luther
The American Institute for Economic Research
When inflation picked back up in January 2024, many commentators described it as more noise than signal. The latest data from the Bureau of Economic Analysis (BEA) casts doubt on that view.
The Personal Consumption Expenditures Price Index (PCEPI), which is the Federal Reserve’s preferred measure of inflation, grew at a continuously compounding annual rate of 4.0 percent in February. The PCEPI has grown at an annualized rate of 3.3 percent over the last three months and 2.5 percent over the last six months. Prices today are 8.7 percentage points higher than they would have been had they grown at an annualized rate of 2.0 percent since January 2020.