Inflation
Consumer price data from FRED, structured to show current readings, the upstream signals that lead them, and the long historical context that puts both in perspective.
CPI Index Level (2016–Present)
What it is: The Consumer Price Index for All Urban Consumers (CPI-U), all items, in raw index form. The base period 1982–84 equals 100; the chart starts in 2016 to focus on the most recent decade.
Why it matters: The level chart shows what year-over-year and annualized rates obscure: the price level itself does not return to its prior path once inflation has occurred. Disinflation slows the rate of price increases; it does not reverse them. The cumulative gap between the actual level and the pre-2020 trajectory is the permanent cost of the 2021–2022 inflation episode.
How to read it: Look at the slope, not just the value. A steeper slope means faster inflation; a flatter slope means slower inflation, but the line continues to rise. Comparing the trajectory before 2020 to the trajectory after shows the structural shift in the price level — the line never came back to where its old trend implied.
Year-over-Year % Change
What it is: 12-month percent change in the Consumer Price Index for all items, goods (commodities less food and energy), and services (services less energy) — three lines on the same axis, last five years.
Why it matters: This is the standard inflation reading the public, the financial press, and the Fed all reference. Showing all-items alongside the goods and services components reveals what's driving the headline number — and the post-2022 pattern has been a divergence story, with goods inflation collapsing while services inflation remained sticky.
How to read it: The Fed targets 2% on a related but different measure (Core PCE), but 2% is also the implicit reference point here. When goods and services move together, inflation is broad-based and easier to interpret. When they diverge — as in 2023–2024, with goods near zero or negative while services ran 4–5% — the all-items reading masks two different stories. Services inflation is the stickier of the two and is what the Fed watches most closely.
6-Month Annualized Rate
What it is: The 6-month change in CPI all items, goods, and services, annualized (multiplied to express as a yearly rate). A higher-frequency signal than the 12-month YoY figure.
Why it matters: The 6-month annualized rate captures turning points sooner than YoY because it does not carry forward inflation from up to a year ago. When inflation is decelerating, this measure shows the deceleration first; when it is reaccelerating, this measure detects it first. It is the metric most often cited by Fed officials when arguing inflation is heading toward or away from target.
How to read it: Watch where the 6-month annualized rate sits relative to the YoY rate on the prior chart. When the 6-month rate is below the YoY rate, recent months are slower than the older months still in the YoY window — disinflation. When the 6-month is above YoY, recent months are faster — reacceleration. Cross-overs between the two are the clearest evidence of a regime shift.
Core CPI vs Core PCE vs Headline CPI
What it is: Three measures of inflation on one chart, all expressed as 12-month percent change: Headline CPI (all items), Core CPI (CPI excluding food and energy), and Core PCE (the Fed's preferred measure, excluding food and energy, based on personal consumption expenditures rather than urban consumer surveys).
Why it matters: These three series are reported separately, watched by different audiences, and frequently confused. Headline CPI captures the cost-of-living experience of consumers, including volatile food and energy. Core CPI strips out that volatility to reveal the underlying trend. Core PCE is what the Fed targets at 2% — and it consistently runs lower than Core CPI due to methodological differences in weighting and substitution effects. The largest single driver of that gap is shelter: housing costs are roughly a third of CPI but only about 16% of PCE, so when shelter inflation is elevated (as it has been since 2022), CPI runs structurally hotter than PCE. Putting all three on one chart makes the relationships and gaps explicit.
How to read it: Core PCE is the Fed's target measure — watch where it sits relative to 2%. Core CPI typically runs a few tenths higher than Core PCE; the spread between them is fairly stable. When Headline CPI diverges sharply from the two core measures, food or energy is driving the gap — useful to know, but not what determines monetary policy. The Fed responds to Core PCE; the household budget responds to Headline CPI.
Market-Implied CPI YoY (TIPS Bootstrap)
What it is: Two series on the same axis. The solid line is realized CPI all-items year-over-year, the same measure shown in the earlier 5-year and 25-year charts. The dashed line, to the right of the vertical divider, is the market-implied CPI YoY rate derived from Treasury Inflation-Protected Securities (TIPS). Each marker represents the inflation rate implied by one TIPS bond's price relative to a comparable nominal Treasury, bootstrapped from the curve so that each point corresponds to the forward period between adjacent maturities. Together the two series give a continuous picture of realized inflation transitioning into market-priced inflation, out to roughly five years forward.
Why it matters: TIPS prices reveal what bond investors are actually willing to pay to be protected from inflation — a market-priced forecast backed by real money, not survey responses or model output. The bootstrap improves on the simpler "breakeven" measure by decomposing the term structure into period-by-period forward rates, so each marker reflects expected inflation over a specific future window rather than averaging across the full holding period. This is the cleanest market read on whether inflation expectations have re-anchored at the Fed's 2% target, drifted above it, or fallen below. Persistent gaps between this line and the target reveal what professional capital actually believes about the central bank's ability to deliver its mandate.
How to read it: The vertical divider separates realized from implied. To the left, observe how far recent CPI has settled from the 2% reference line; to the right, observe whether the market expects convergence, continued overshoot, or undershoot. A flat dashed line near 2% means the market is pricing a credible return to target. A dashed line that drifts higher or stays elevated means the market is pricing structural inflation above target. Near-term markers move with cyclical news and Fed communication; later markers reflect longer-term expectations and tend to be stickier. The small gap in the realized line at October 2025 reflects the BLS cancellation of that month's CPI release during the federal shutdown — the underlying data is missing, not zero. When market-implied readings diverge persistently from the Fed's own forecasts, that gap itself is the signal.
PPI Final Demand — YoY %
What it is: The Producer Price Index for Final Demand, year-over-year percent change. PPI measures the average change over time in selling prices received by domestic producers for their output — the prices firms charge each other, before the goods reach consumers. The BLS Final Demand methodology was introduced in late 2009, so the series begins in 2010 — there is no longer history for this measure.
Why it matters: Producer prices typically lead consumer prices by several months. When PPI accelerates, businesses face rising input costs that they will either absorb (margin compression) or pass through (consumer inflation). PPI deceleration tends to precede CPI deceleration. The relationship is not mechanical — pass-through depends on competitive dynamics and demand conditions — but the directional signal is real.
How to read it: Treat PPI as a leading indicator with a 3–6 month lag to CPI. When PPI is running well above CPI, pipeline pressure is building. When PPI is running well below CPI, businesses are absorbing the gap and inflation pressure is easing from the supply side. Sharp moves in PPI (up or down) historically precede comparable moves in CPI within two quarters.
Import Prices — YoY %
What it is: The Import Price Index for all commodities, year-over-year percent change. Reported monthly by the Bureau of Labor Statistics, it measures the change in prices US importers pay for foreign-produced goods before they enter the domestic supply chain.
Why it matters: Import prices are where dollar movements and global commodity prices first hit US inflation. A weaker dollar makes imports more expensive in dollar terms; a stronger dollar dampens import costs and helps anchor domestic inflation. The series is also sensitive to global supply conditions — when global commodity prices rise or supply chains tighten, import prices reflect it before domestic CPI.
How to read it: Sustained positive readings indicate inflationary pressure from abroad — either from currency weakness, foreign cost pressure, or both. Negative readings indicate a deflationary impulse from the import channel — typically a strong dollar combined with weak global commodity prices. The series can swing widely with the dollar and oil prices; the trend matters more than any single month. Pay particular attention when the trend in import prices diverges from domestic PPI — that gap often signals dollar dynamics worth understanding.
Commodities — YoY % (IMF Global Price Index)
What it is: The IMF Global Price Index of All Commodities, year-over-year percent change. The index aggregates benchmark prices set by the largest exporters across energy, metals, agriculture, and other commodity groups, in nominal US dollars. Monthly history from 1992.
Why it matters: Commodities are the rawest input to the inflation process. When commodity prices rise, producer costs rise, eventually flowing through to consumer prices. Commodity-driven inflation episodes (1973, 1979, 2008, 2021–2022) tend to be sharp and visible. Conversely, sustained commodity weakness has historically coincided with sub-target inflation and easier monetary conditions.
How to read it: The IMF index is heavily weighted toward energy, so movements correlate strongly with oil. Sustained YoY readings above 20% have historically preceded inflation surges; sustained readings below −20% have coincided with disinflation or outright deflationary periods. The signal is not a 1:1 pass-through — central banks typically "look through" commodity shocks unless they appear to be feeding into broader expectations — but a persistent commodity move shifts the inflation backdrop.
Gold Price (USD/oz, Log Scale)
What it is: The spot price of gold in US dollars per troy ounce, plotted on a logarithmic scale so that proportional moves appear as equal vertical distances. Monthly data from 2000 onward.
Why it matters: Gold has no yield, no industrial necessity comparable to copper or oil, and no central-bank backing — yet it has been a monetary asset for thousands of years. Its price reflects the marginal investor's demand for a store of value outside the fiat system. Gold tends to rise when real interest rates fall, when central banks expand balance sheets, when geopolitical risk increases, or when confidence in the dollar's purchasing power weakens. On a long-enough horizon, gold has tracked the loss of purchasing power in fiat currencies — a market-priced measure of monetary debasement.
How to read it: Log scale matters — gold has moved from roughly $250 in 2000 to multi-thousand-dollar levels, and a linear scale would visually compress the earlier history into a flat line. On the log chart, equal vertical moves represent equal percentage moves. Sustained breakouts to new highs have historically coincided with monetary regime concerns: 2008–2011 (post-GFC QE), 2019–2020 (pre-COVID and COVID monetary expansion), and the recent move. Gold is not a precise inflation hedge in the short run, but its long-run trajectory has tracked the erosion of fiat purchasing power.
M2 Money Stock — YoY %
What it is: The M2 measure of the US money supply — currency in circulation plus checkable deposits, savings deposits, small time deposits, and retail money market funds — shown as 12-month percent change. Monthly history from 1959.
Why it matters: Whether money supply growth is the cause of inflation, a coincident indicator of it, or merely correlated with it, is one of the longest-running debates in macroeconomics. What is not debatable is that the most extreme money supply movements in US history coincide closely with the most extreme inflation movements. The 2020–2021 M2 surge — peaking at roughly 27% YoY, by far the largest in the post-war record — preceded the 2021–2022 inflation surge with a lag of roughly 12–18 months. The subsequent M2 contraction (the first since the 1930s) coincided with the disinflation that followed.
How to read it: Pre-COVID, M2 growth typically ran in a 4–8% range. The 2020 surge to 27% was an outlier of historic magnitude — direct fiscal transfers funded by Fed balance sheet expansion. The subsequent contraction to negative readings in 2022–2023 was equally unprecedented. Whether one views this through a monetarist lens (money supply drives prices) or simply as a coincident indicator, the visual record is striking: the largest monetary expansion in modern US history was followed by the largest inflation surge in 40 years.
Year-over-Year % Change (2000–Present)
What it is: The same three-line CPI YoY measure from the earlier 5-year chart (all items, goods, services), extended back to 2000 to provide a quarter-century of context.
Why it matters: The 2000–present window captures the post-dot-com era, the global financial crisis and its disinflationary aftermath, the 2010s "stable but below-target" period, and the post-COVID inflation surge. It is long enough to show structural patterns but short enough to remain relevant to the current monetary regime, in which Fed targeting and inflation expectations dynamics resemble today's framework.
How to read it: The 2010–2019 decade was an unusually quiet inflation regime — Core PCE generally below 2%, headline rarely above 3%. That period is the implicit "normal" most analysts and policymakers reference when evaluating current readings. The 2022 spike is visually striking against that backdrop; the question reasonable observers debate is whether the post-pandemic regime returns to pre-pandemic patterns or settles into something structurally different. The chart does not answer that question — it just gives the visual context for asking it.
CPI All Items — YoY % (Full History, 1913–Present)
What it is: Headline CPI year-over-year percent change from 1913 to the present — the full available history of the official US consumer price index. Single line, all items only, for visual clarity over more than a century.
Why it matters: The long view contains every inflation regime US monetary history has produced — the WWI surge, the deflationary 1920s and 1930s, the WWII surge and postwar adjustment, the Great Inflation of the 1970s, the Volcker disinflation, the Great Moderation, and the post-COVID episode. It is the chart that contextualizes everything. Current readings of 2–4% inflation look severe against the post-1990 backdrop but mild against the 1970s. Deflationary risks look remote today but were dominant from 1929 to 1933.
How to read it: Each inflation episode in the chart has its own cause and resolution. The pre-1971 episodes occurred under the Bretton Woods gold-exchange system and were largely war-driven. The 1970s inflation occurred after the dollar broke its last formal link to gold and was eventually broken by tight monetary policy under Volcker. The post-1990 stability reflects a credible inflation-targeting regime. The 2021–2022 episode is a fiscal-monetary event unprecedented in scale outside of wartime. The lesson the long history teaches is that inflation regimes change — and the regime that has held for 30 years is not guaranteed to hold indefinitely.