An alternative to CEAs approach is to take the Atlanta Federal Reserves Wage Growth Tracker nominal cash wage growth, adjust for taxes and fringe benefits, and deflate with the PCEPI
, in which case real after-tax compensation growth is 1.9 percent over the same period.
* Core PCE price index, the PCEPI
excluding food and energy (core PCEPI
Historically, economists and other analysts have used either the CPI or the PCEPI
to deflate measures of nominal income.
Core inflation as measured by the consumer price index (CPI) declined to 1.1 percent (year-over-year) by the end of 2003 while the core personal consumption expenditures price index (PCEPI
) moved below 1 percent.
attempts to cover the prices of all items consumed by residents of the United States.
Figure 3 plots the PCEPI
core services inflation rate and the contributions of its major components from 1983 to 2003.
is used as the inflation adjuster in this study for three reasons.
The autoregressive forecast is simply a standard autoregressive model with 12 lags of the dependent variable--either the 12-month percent change (logs) in the seasonally adjusted all-items consumer price index for all urban consumers (CPI-U) or the seasonally adjusted personal consumption expenditures chain-weighted price index (PCEPI
Similar readings have been registered in the other major measure of retail prices, the Price Index for Personal Consumption Expenditures (PCEPI
The inflation series are based on the overall price indices measured by the consumer price index (CPI) and the personal consumption expenditures (PCE) price index (PCEPI
), as well as their respective "core" measures that exclude food and energy prices.
With this measure, called the 16% trimmed-mean estimator, we see larger retail price increases currently than with the the more commonly used inflation measures, the CPI and the Personal Consumption Expenditures Price Index (PCEPI
With the release of the minutes of the FOMC meeting of October 30-31 was a Summary of Economic Projections that included explicit multiyear forecasts for real gross domestic product (GDP), the fourth-quarter average unemployment rate, and two measures of consumer price inflation--the chain price index for personal consumption expenditures (PCEPI
) and the same measure excluding food and energy (core PCEPI