Accessible Version
Accessible Version
Figure 1. U.S. Inflation since the 1960s
| Date | Total PCE price index | Core PCE price index | Long-term trend |
|---|---|---|---|
| 1960:Q1 | 1.67 | 2.07 | ND |
| 1960:Q2 | 1.81 | 1.94 | ND |
| 1960:Q3 | 1.59 | 1.70 | ND |
| 1960:Q4 | 1.49 | 1.45 | ND |
| 1961:Q1 | 1.55 | 1.30 | ND |
| 1961:Q2 | 1.00 | 1.24 | ND |
| 1961:Q3 | 0.99 | 1.28 | ND |
| 1961:Q4 | 0.66 | 1.20 | ND |
| 1962:Q1 | 0.92 | 1.41 | ND |
| 1962:Q2 | 1.28 | 1.46 | ND |
| 1962:Q3 | 1.17 | 1.33 | ND |
| 1962:Q4 | 1.36 | 1.26 | ND |
| 1963:Q1 | 1.19 | 1.21 | ND |
| 1963:Q2 | 0.99 | 1.18 | ND |
| 1963:Q3 | 1.20 | 1.24 | ND |
| 1963:Q4 | 1.28 | 1.56 | ND |
| 1964:Q1 | 1.48 | 1.66 | ND |
| 1964:Q2 | 1.56 | 1.62 | ND |
| 1964:Q3 | 1.42 | 1.54 | ND |
| 1964:Q4 | 1.39 | 1.31 | ND |
| 1965:Q1 | 1.23 | 1.24 | 2.83 |
| 1965:Q2 | 1.51 | 1.24 | 2.92 |
| 1965:Q3 | 1.55 | 1.26 | 3.00 |
| 1965:Q4 | 1.51 | 1.33 | 3.06 |
| 1966:Q1 | 1.97 | 1.47 | 3.13 |
| 1966:Q2 | 2.29 | 1.98 | 3.23 |
| 1966:Q3 | 2.70 | 2.51 | 3.29 |
| 1966:Q4 | 3.18 | 3.06 | 3.36 |
| 1967:Q1 | 2.68 | 3.11 | 3.39 |
| 1967:Q2 | 2.33 | 2.96 | 3.51 |
| 1967:Q3 | 2.49 | 3.03 | 3.65 |
| 1967:Q4 | 2.57 | 3.16 | 3.73 |
| 1968:Q1 | 3.35 | 3.75 | 3.85 |
| 1968:Q2 | 3.91 | 4.26 | 3.85 |
| 1968:Q3 | 4.03 | 4.48 | 3.81 |
| 1968:Q4 | 4.29 | 4.65 | 3.84 |
| 1969:Q1 | 4.21 | 4.64 | 3.82 |
| 1969:Q2 | 4.48 | 4.69 | 3.85 |
| 1969:Q3 | 4.68 | 4.72 | 3.81 |
| 1969:Q4 | 4.73 | 4.74 | 3.81 |
| 1970:Q1 | 4.92 | 4.71 | 3.79 |
| 1970:Q2 | 4.74 | 4.64 | 3.81 |
| 1970:Q3 | 4.47 | 4.59 | 3.84 |
| 1970:Q4 | 4.62 | 4.82 | 3.92 |
| 1971:Q1 | 4.39 | 5.01 | 3.95 |
| 1971:Q2 | 4.43 | 5.02 | 3.95 |
| 1971:Q3 | 4.44 | 4.84 | 3.92 |
| 1971:Q4 | 3.75 | 3.98 | 3.98 |
| 1972:Q1 | 3.86 | 3.67 | 4.12 |
| 1972:Q2 | 3.28 | 3.20 | 4.19 |
| 1972:Q3 | 3.18 | 3.01 | 4.31 |
| 1972:Q4 | 3.37 | 3.06 | 4.49 |
| 1973:Q1 | 3.53 | 2.79 | 4.67 |
| 1973:Q2 | 4.91 | 3.49 | 4.83 |
| 1973:Q3 | 5.89 | 4.09 | 4.96 |
| 1973:Q4 | 7.18 | 4.88 | 5.13 |
| 1974:Q1 | 9.05 | 5.93 | 5.27 |
| 1974:Q2 | 10.02 | 7.10 | 5.35 |
| 1974:Q3 | 10.98 | 8.72 | 5.32 |
| 1974:Q4 | 11.51 | 9.85 | 5.35 |
| 1975:Q1 | 10.34 | 10.12 | 5.46 |
| 1975:Q2 | 8.63 | 9.09 | 5.60 |
| 1975:Q3 | 7.75 | 7.65 | 5.89 |
| 1975:Q4 | 6.84 | 6.79 | 5.88 |
| 1976:Q1 | 6.02 | 6.33 | 5.77 |
| 1976:Q2 | 5.60 | 5.98 | 5.53 |
| 1976:Q3 | 5.23 | 6.04 | 5.85 |
| 1976:Q4 | 5.13 | 5.97 | 5.98 |
| 1977:Q1 | 5.84 | 6.12 | 6.03 |
| 1977:Q2 | 6.76 | 6.47 | 5.89 |
| 1977:Q3 | 6.75 | 6.58 | 6.04 |
| 1977:Q4 | 6.60 | 6.49 | 6.14 |
| 1978:Q1 | 6.47 | 6.41 | 6.39 |
| 1978:Q2 | 6.84 | 6.62 | 6.54 |
| 1978:Q3 | 7.10 | 6.68 | 6.70 |
| 1978:Q4 | 7.58 | 7.02 | 6.84 |
| 1979:Q1 | 7.80 | 6.77 | 6.83 |
| 1979:Q2 | 8.50 | 7.25 | 7.00 |
| 1979:Q3 | 9.27 | 7.37 | 6.96 |
| 1979:Q4 | 9.83 | 7.67 | 7.08 |
| 1980:Q1 | 11.03 | 8.82 | 7.00 |
| 1980:Q2 | 10.73 | 8.86 | 6.74 |
| 1980:Q3 | 10.58 | 9.27 | 6.60 |
| 1980:Q4 | 10.64 | 9.65 | 6.39 |
| 1981:Q1 | 10.21 | 9.41 | 5.84 |
| 1981:Q2 | 9.38 | 9.04 | 5.21 |
| 1981:Q3 | 8.63 | 8.62 | 4.98 |
| 1981:Q4 | 7.63 | 7.92 | 4.29 |
| 1982:Q1 | 6.23 | 7.10 | 4.11 |
| 1982:Q2 | 5.48 | 6.54 | 4.08 |
| 1982:Q3 | 5.42 | 6.30 | 4.18 |
| 1982:Q4 | 4.99 | 5.92 | 4.06 |
| 1983:Q1 | 4.58 | 5.83 | 4.02 |
| 1983:Q2 | 4.55 | 5.24 | 4.00 |
| 1983:Q3 | 4.28 | 5.16 | 4.10 |
| 1983:Q4 | 3.82 | 4.54 | 4.12 |
| 1984:Q1 | 4.04 | 4.17 | 4.09 |
| 1984:Q2 | 4.09 | 4.58 | 3.95 |
| 1984:Q3 | 3.53 | 3.98 | 3.94 |
| 1984:Q4 | 3.49 | 3.89 | 3.95 |
| 1985:Q1 | 3.61 | 4.28 | 3.99 |
| 1985:Q2 | 3.48 | 4.01 | 3.81 |
| 1985:Q3 | 3.50 | 4.11 | 3.75 |
| 1985:Q4 | 3.57 | 4.09 | 3.79 |
| 1986:Q1 | 3.07 | 3.79 | 3.74 |
| 1986:Q2 | 2.09 | 3.54 | 3.79 |
| 1986:Q3 | 1.80 | 3.15 | 3.87 |
| 1986:Q4 | 1.71 | 3.25 | 3.90 |
| 1987:Q1 | 1.93 | 2.78 | 3.89 |
| 1987:Q2 | 3.02 | 3.08 | 3.86 |
| 1987:Q3 | 3.46 | 3.30 | 3.85 |
| 1987:Q4 | 3.75 | 3.54 | 3.82 |
| 1988:Q1 | 3.59 | 3.88 | 3.85 |
| 1988:Q2 | 3.75 | 4.14 | 3.87 |
| 1988:Q3 | 4.05 | 4.42 | 3.84 |
| 1988:Q4 | 4.18 | 4.49 | 3.85 |
| 1989:Q1 | 4.53 | 4.60 | 3.74 |
| 1989:Q2 | 4.77 | 4.27 | 3.65 |
| 1989:Q3 | 4.08 | 3.82 | 3.57 |
| 1989:Q4 | 3.85 | 3.62 | 3.55 |
| 1990:Q1 | 4.17 | 3.69 | 3.51 |
| 1990:Q2 | 3.72 | 3.91 | 3.33 |
| 1990:Q3 | 4.43 | 4.20 | 3.10 |
| 1990:Q4 | 4.98 | 4.12 | 2.96 |
| 1991:Q1 | 4.02 | 3.83 | 2.93 |
| 1991:Q2 | 3.64 | 3.47 | 2.88 |
| 1991:Q3 | 3.05 | 3.37 | 2.83 |
| 1991:Q4 | 2.44 | 3.32 | 2.73 |
| 1992:Q1 | 2.57 | 3.22 | 2.66 |
| 1992:Q2 | 2.70 | 3.16 | 2.61 |
| 1992:Q3 | 2.66 | 2.85 | 2.58 |
| 1992:Q4 | 2.65 | 2.82 | 2.55 |
| 1993:Q1 | 2.62 | 2.75 | 2.49 |
| 1993:Q2 | 2.64 | 2.81 | 2.42 |
| 1993:Q3 | 2.43 | 2.78 | 2.38 |
| 1993:Q4 | 2.30 | 2.55 | 2.32 |
| 1994:Q1 | 2.06 | 2.30 | 2.28 |
| 1994:Q2 | 1.94 | 2.21 | 2.27 |
| 1994:Q3 | 2.22 | 2.20 | 2.22 |
| 1994:Q4 | 2.11 | 2.20 | 2.18 |
| 1995:Q1 | 2.24 | 2.26 | 2.14 |
| 1995:Q2 | 2.25 | 2.17 | 2.10 |
| 1995:Q3 | 1.93 | 2.08 | 2.08 |
| 1995:Q4 | 1.90 | 2.07 | 2.06 |
| 1996:Q1 | 1.98 | 1.96 | 2.03 |
| 1996:Q2 | 2.08 | 1.85 | 2.01 |
| 1996:Q3 | 2.11 | 1.84 | 1.99 |
| 1996:Q4 | 2.35 | 1.90 | 1.98 |
| 1997:Q1 | 2.22 | 1.89 | 1.96 |
| 1997:Q2 | 1.80 | 1.94 | 1.95 |
| 1997:Q3 | 1.63 | 1.71 | 1.91 |
| 1997:Q4 | 1.26 | 1.45 | 1.90 |
| 1998:Q1 | 0.81 | 1.34 | 1.88 |
| 1998:Q2 | 0.74 | 1.12 | 1.86 |
| 1998:Q3 | 0.79 | 1.25 | 1.86 |
| 1998:Q4 | 0.73 | 1.24 | 1.85 |
| 1999:Q1 | 1.00 | 1.29 | 1.83 |
| 1999:Q2 | 1.36 | 1.29 | 1.83 |
| 1999:Q3 | 1.59 | 1.29 | 1.82 |
| 1999:Q4 | 1.93 | 1.44 | 1.81 |
| 2000:Q1 | 2.51 | 1.67 | 1.80 |
| 2000:Q2 | 2.43 | 1.69 | 1.78 |
| 2000:Q3 | 2.53 | 1.80 | 1.78 |
| 2000:Q4 | 2.49 | 1.83 | 1.77 |
| 2001:Q1 | 2.32 | 1.84 | 1.77 |
| 2001:Q2 | 2.34 | 1.91 | 1.76 |
| 2001:Q3 | 1.78 | 1.73 | 1.75 |
| 2001:Q4 | 1.29 | 1.76 | 1.74 |
| 2002:Q1 | 0.81 | 1.48 | 1.76 |
| 2002:Q2 | 1.10 | 1.67 | 1.76 |
| 2002:Q3 | 1.53 | 1.91 | 1.77 |
| 2002:Q4 | 1.93 | 1.75 | 1.77 |
| 2003:Q1 | 2.46 | 1.70 | 1.77 |
| 2003:Q2 | 1.77 | 1.48 | 1.79 |
| 2003:Q3 | 1.87 | 1.37 | 1.81 |
| 2003:Q4 | 1.82 | 1.37 | 1.83 |
| 2004:Q1 | 1.88 | 1.67 | 1.84 |
| 2004:Q2 | 2.51 | 1.92 | 1.85 |
| 2004:Q3 | 2.48 | 1.97 | 1.87 |
| 2004:Q4 | 2.87 | 2.09 | 1.89 |
| 2005:Q1 | 2.62 | 2.19 | 1.91 |
| 2005:Q2 | 2.58 | 2.12 | 1.92 |
| 2005:Q3 | 3.10 | 2.07 | 1.93 |
| 2005:Q4 | 3.10 | 2.26 | 1.94 |
| 2006:Q1 | 3.04 | 2.13 | 1.94 |
| 2006:Q2 | 3.15 | 2.27 | 1.93 |
| 2006:Q3 | 2.76 | 2.39 | 1.91 |
| 2006:Q4 | 1.78 | 2.16 | 1.89 |
| 2007:Q1 | 2.26 | 2.36 | 1.87 |
| 2007:Q2 | 2.28 | 2.04 | 1.84 |
| 2007:Q3 | 2.13 | 1.99 | 1.84 |
| 2007:Q4 | 3.34 | 2.25 | 1.83 |
| 2008:Q1 | 3.26 | 2.11 | 1.83 |
| 2008:Q2 | 3.52 | 2.27 | 1.82 |
| 2008:Q3 | 3.98 | 2.23 | 1.81 |
| 2008:Q4 | 1.47 | 1.64 | 1.82 |
| 2009:Q1 | 0.04 | 1.18 | 1.82 |
| 2009:Q2 | -0.55 | 1.16 | 1.83 |
| 2009:Q3 | -0.93 | 0.99 | 1.83 |
| 2009:Q4 | 1.20 | 1.42 | 1.84 |
| 2010:Q1 | 2.12 | 1.55 | 1.87 |
| 2010:Q2 | 1.78 | 1.33 | 1.88 |
| 2010:Q3 | 1.44 | 1.29 | 1.90 |
| 2010:Q4 | 1.29 | 0.97 | 1.92 |
| 2011:Q1 | 1.70 | 1.05 | 1.94 |
| 2011:Q2 | 2.61 | 1.40 | 1.97 |
| 2011:Q3 | 2.85 | 1.66 | 1.98 |
| 2011:Q4 | 2.66 | 1.86 | 2.00 |
| 2012:Q1 | 2.49 | 2.09 | 2.00 |
| 2012:Q2 | 1.77 | 1.95 | 1.99 |
| 2012:Q3 | 1.57 | 1.75 | 2.00 |
| 2012:Q4 | 1.76 | 1.78 | 2.00 |
| 2013:Q1 | 1.52 | 1.65 | 1.99 |
| 2013:Q2 | 1.32 | 1.48 | 2.00 |
| 2013:Q3 | 1.41 | 1.52 | 1.99 |
| 2013:Q4 | 1.22 | 1.51 | 1.99 |
| 2014:Q1 | 1.28 | 1.43 | 1.99 |
| 2014:Q2 | 1.71 | 1.62 | 1.99 |
| 2014:Q3 | 1.59 | 1.62 | 1.99 |
| 2014:Q4 | 1.12 | 1.44 | 2.01 |
| 2015:Q1 | 0.23 | 1.33 | 2.02 |
| 2015:Q2 | 0.24 | 1.29 | 2.04 |
ND: No data. Return to table
Note: The data are quarterly. The data for the long-term trend start in 1965:Q1. PCE is personal consumption expenditures.
Source: U.S. Department of Commerce, Bureau of Economic Analysis; Federal Reserve Board staff calculations (see note 3 of speech text for additional discussion).
Figure 2. Recent U.S. Inflation Has Been Undesirably Low
| Date | Total PCE price index | Core PCE price index |
|---|---|---|
| 2000:Q1 | 2.51 | 1.67 |
| 2000:Q2 | 2.43 | 1.69 |
| 2000:Q3 | 2.53 | 1.80 |
| 2000:Q4 | 2.49 | 1.83 |
| 2001:Q1 | 2.32 | 1.84 |
| 2001:Q2 | 2.34 | 1.91 |
| 2001:Q3 | 1.78 | 1.73 |
| 2001:Q4 | 1.29 | 1.76 |
| 2002:Q1 | 0.81 | 1.48 |
| 2002:Q2 | 1.10 | 1.67 |
| 2002:Q3 | 1.53 | 1.91 |
| 2002:Q4 | 1.93 | 1.75 |
| 2003:Q1 | 2.46 | 1.70 |
| 2003:Q2 | 1.77 | 1.48 |
| 2003:Q3 | 1.87 | 1.37 |
| 2003:Q4 | 1.82 | 1.37 |
| 2004:Q1 | 1.88 | 1.67 |
| 2004:Q2 | 2.51 | 1.92 |
| 2004:Q3 | 2.48 | 1.97 |
| 2004:Q4 | 2.87 | 2.09 |
| 2005:Q1 | 2.62 | 2.19 |
| 2005:Q2 | 2.58 | 2.12 |
| 2005:Q3 | 3.10 | 2.07 |
| 2005:Q4 | 3.10 | 2.26 |
| 2006:Q1 | 3.04 | 2.13 |
| 2006:Q2 | 3.15 | 2.27 |
| 2006:Q3 | 2.76 | 2.39 |
| 2006:Q4 | 1.78 | 2.16 |
| 2007:Q1 | 2.26 | 2.36 |
| 2007:Q2 | 2.28 | 2.04 |
| 2007:Q3 | 2.13 | 1.99 |
| 2007:Q4 | 3.34 | 2.25 |
| 2008:Q1 | 3.26 | 2.11 |
| 2008:Q2 | 3.52 | 2.27 |
| 2008:Q3 | 3.98 | 2.23 |
| 2008:Q4 | 1.47 | 1.64 |
| 2009:Q1 | 0.04 | 1.18 |
| 2009:Q2 | -0.55 | 1.16 |
| 2009:Q3 | -0.93 | 0.99 |
| 2009:Q4 | 1.20 | 1.42 |
| 2010:Q1 | 2.12 | 1.55 |
| 2010:Q2 | 1.78 | 1.33 |
| 2010:Q3 | 1.44 | 1.29 |
| 2010:Q4 | 1.29 | 0.97 |
| 2011:Q1 | 1.70 | 1.05 |
| 2011:Q2 | 2.61 | 1.40 |
| 2011:Q3 | 2.85 | 1.66 |
| 2011:Q4 | 2.66 | 1.86 |
| 2012:Q1 | 2.49 | 2.09 |
| 2012:Q2 | 1.77 | 1.95 |
| 2012:Q3 | 1.57 | 1.75 |
| 2012:Q4 | 1.76 | 1.78 |
| 2013:Q1 | 1.52 | 1.65 |
| 2013:Q2 | 1.32 | 1.48 |
| 2013:Q3 | 1.41 | 1.52 |
| 2013:Q4 | 1.22 | 1.51 |
| 2014:Q1 | 1.28 | 1.43 |
| 2014:Q2 | 1.71 | 1.62 |
| 2014:Q3 | 1.59 | 1.62 |
| 2014:Q4 | 1.12 | 1.44 |
| 2015:Q1 | 0.23 | 1.33 |
| 2015:Q2 | 0.24 | 1.29 |
Note: The data are quarterly. PCE is personal consumption expenditures; FOMC is Federal Open Market Committee. The FOMC longer-run goal is shown as a dotted horizontal line at 2.00.
Source: U.S. Department of Commerce, Bureau of Economic Analysis.
Figure 3. Wage Growth and Inflation Co-Move over Time
| Date |
Employment cost index for total compensation, private industry workers |
Total PCE price index |
|---|---|---|
| 1977:Q1 | ND | 5.8 |
| 1977:Q2 | ND | 6.8 |
| 1977:Q3 | ND | 6.8 |
| 1977:Q4 | ND | 6.6 |
| 1978:Q1 | ND | 6.5 |
| 1978:Q2 | ND | 6.8 |
| 1978:Q3 | ND | 7.1 |
| 1978:Q4 | ND | 7.6 |
| 1979:Q1 | ND | 7.8 |
| 1979:Q2 | ND | 8.5 |
| 1979:Q3 | ND | 9.3 |
| 1979:Q4 | ND | 9.8 |
| 1980:Q1 | ND | 11.0 |
| 1980:Q2 | ND | 10.7 |
| 1980:Q3 | ND | 10.6 |
| 1980:Q4 | 9.5 | 10.6 |
| 1981:Q1 | 10.7 | 10.2 |
| 1981:Q2 | 10.2 | 9.4 |
| 1981:Q3 | 9.9 | 8.6 |
| 1981:Q4 | 10.0 | 7.6 |
| 1982:Q1 | 7.8 | 6.2 |
| 1982:Q2 | 7.4 | 5.5 |
| 1982:Q3 | 7.2 | 5.4 |
| 1982:Q4 | 6.3 | 5.0 |
| 1983:Q1 | 6.5 | 4.6 |
| 1983:Q2 | 6.1 | 4.6 |
| 1983:Q3 | 5.5 | 4.3 |
| 1983:Q4 | 5.7 | 3.8 |
| 1984:Q1 | 5.9 | 4.0 |
| 1984:Q2 | 5.6 | 4.1 |
| 1984:Q3 | 5.0 | 3.5 |
| 1984:Q4 | 5.0 | 3.5 |
| 1985:Q1 | 4.2 | 3.6 |
| 1985:Q2 | 4.2 | 3.5 |
| 1985:Q3 | 4.6 | 3.5 |
| 1985:Q4 | 3.9 | 3.6 |
| 1986:Q1 | 3.8 | 3.1 |
| 1986:Q2 | 3.8 | 2.1 |
| 1986:Q3 | 3.1 | 1.8 |
| 1986:Q4 | 3.1 | 1.7 |
| 1987:Q1 | 3.1 | 1.9 |
| 1987:Q2 | 3.0 | 3.0 |
| 1987:Q3 | 3.4 | 3.5 |
| 1987:Q4 | 3.4 | 3.8 |
| 1988:Q1 | 4.0 | 3.6 |
| 1988:Q2 | 4.3 | 3.8 |
| 1988:Q3 | 4.3 | 4.1 |
| 1988:Q4 | 4.8 | 4.2 |
| 1989:Q1 | 4.6 | 4.5 |
| 1989:Q2 | 4.5 | 4.8 |
| 1989:Q3 | 4.9 | 4.1 |
| 1989:Q4 | 4.8 | 3.9 |
| 1990:Q1 | 5.1 | 4.2 |
| 1990:Q2 | 5.2 | 3.7 |
| 1990:Q3 | 5.0 | 4.4 |
| 1990:Q4 | 4.6 | 5.0 |
| 1991:Q1 | 4.3 | 4.0 |
| 1991:Q2 | 4.5 | 3.6 |
| 1991:Q3 | 4.4 | 3.1 |
| 1991:Q4 | 4.4 | 2.4 |
| 1992:Q1 | 4.3 | 2.6 |
| 1992:Q2 | 3.6 | 2.7 |
| 1992:Q3 | 3.4 | 2.7 |
| 1992:Q4 | 3.6 | 2.7 |
| 1993:Q1 | 3.5 | 2.6 |
| 1993:Q2 | 3.6 | 2.6 |
| 1993:Q3 | 3.8 | 2.4 |
| 1993:Q4 | 3.6 | 2.3 |
| 1994:Q1 | 3.4 | 2.1 |
| 1994:Q2 | 3.4 | 1.9 |
| 1994:Q3 | 3.3 | 2.2 |
| 1994:Q4 | 3.2 | 2.1 |
| 1995:Q1 | 2.8 | 2.2 |
| 1995:Q2 | 2.8 | 2.3 |
| 1995:Q3 | 2.6 | 1.9 |
| 1995:Q4 | 2.5 | 1.9 |
| 1996:Q1 | 2.8 | 2.0 |
| 1996:Q2 | 2.9 | 2.1 |
| 1996:Q3 | 2.9 | 2.1 |
| 1996:Q4 | 3.1 | 2.4 |
| 1997:Q1 | 3.0 | 2.2 |
| 1997:Q2 | 2.9 | 1.8 |
| 1997:Q3 | 3.1 | 1.6 |
| 1997:Q4 | 3.5 | 1.3 |
| 1998:Q1 | 3.6 | 0.8 |
| 1998:Q2 | 3.5 | 0.7 |
| 1998:Q3 | 3.9 | 0.8 |
| 1998:Q4 | 3.5 | 0.7 |
| 1999:Q1 | 2.9 | 1.0 |
| 1999:Q2 | 3.3 | 1.4 |
| 1999:Q3 | 3.0 | 1.6 |
| 1999:Q4 | 3.5 | 1.9 |
| 2000:Q1 | 4.6 | 2.5 |
| 2000:Q2 | 4.6 | 2.4 |
| 2000:Q3 | 4.7 | 2.5 |
| 2000:Q4 | 4.2 | 2.5 |
| 2001:Q1 | 4.2 | 2.3 |
| 2001:Q2 | 4.0 | 2.3 |
| 2001:Q3 | 4.0 | 1.8 |
| 2001:Q4 | 4.1 | 1.3 |
| 2002:Q1 | 3.8 | 0.8 |
| 2002:Q2 | 4.0 | 1.1 |
| 2002:Q3 | 3.5 | 1.5 |
| 2002:Q4 | 3.1 | 1.9 |
| 2003:Q1 | 3.6 | 2.5 |
| 2003:Q2 | 3.5 | 1.8 |
| 2003:Q3 | 3.9 | 1.9 |
| 2003:Q4 | 4.0 | 1.8 |
| 2004:Q1 | 3.8 | 1.9 |
| 2004:Q2 | 3.9 | 2.5 |
| 2004:Q3 | 3.8 | 2.5 |
| 2004:Q4 | 3.8 | 2.9 |
| 2005:Q1 | 3.5 | 2.6 |
| 2005:Q2 | 3.1 | 2.6 |
| 2005:Q3 | 2.9 | 3.1 |
| 2005:Q4 | 2.9 | 3.1 |
| 2006:Q1 | 2.6 | 3.0 |
| 2006:Q2 | 2.8 | 3.2 |
| 2006:Q3 | 3.0 | 2.8 |
| 2006:Q4 | 3.2 | 1.8 |
| 2007:Q1 | 3.2 | 2.3 |
| 2007:Q2 | 3.1 | 2.3 |
| 2007:Q3 | 3.1 | 2.1 |
| 2007:Q4 | 3.0 | 3.3 |
| 2008:Q1 | 3.2 | 3.3 |
| 2008:Q2 | 3.0 | 3.5 |
| 2008:Q3 | 2.8 | 4.0 |
| 2008:Q4 | 2.4 | 1.5 |
| 2009:Q1 | 1.9 | 0.0 |
| 2009:Q2 | 1.5 | -0.6 |
| 2009:Q3 | 1.2 | -0.9 |
| 2009:Q4 | 1.2 | 1.2 |
| 2010:Q1 | 1.6 | 2.1 |
| 2010:Q2 | 1.9 | 1.8 |
| 2010:Q3 | 2.0 | 1.4 |
| 2010:Q4 | 2.1 | 1.3 |
| 2011:Q1 | 2.0 | 1.7 |
| 2011:Q2 | 2.3 | 2.6 |
| 2011:Q3 | 2.1 | 2.9 |
| 2011:Q4 | 2.2 | 2.7 |
| 2012:Q1 | 2.1 | 2.5 |
| 2012:Q2 | 1.8 | 1.8 |
| 2012:Q3 | 1.9 | 1.6 |
| 2012:Q4 | 1.8 | 1.8 |
| 2013:Q1 | 1.9 | 1.5 |
| 2013:Q2 | 1.9 | 1.3 |
| 2013:Q3 | 1.9 | 1.4 |
| 2013:Q4 | 2.0 | 1.2 |
| 2014:Q1 | 1.7 | 1.3 |
| 2014:Q2 | 2.0 | 1.7 |
| 2014:Q3 | 2.3 | 1.6 |
| 2014:Q4 | 2.3 | 1.1 |
| 2015:Q1 | 2.8 | 0.2 |
| 2015:Q2 | 1.9 | 0.2 |
ND: No data. Return to table
Note: The data are quarterly. The data for the employment cost index start in 1980:Q4. PCE is personal consumption expenditures.
Source: U.S. Department of Commerce, Bureau of Economic Analysis; U.S. Department of Labor, Bureau of Labor Statistics.
Figure 4. Unemployment, Inflation, and the Federal Funds Rate
| Date | Unemployment rate | Total PCE price index | Federal funds rate |
|---|---|---|---|
| January 2007 | 4.6 | 2.00 | 5.25 |
| February 2007 | 4.5 | 2.29 | 5.25 |
| March 2007 | 4.4 | 2.48 | 5.25 |
| April 2007 | 4.5 | 2.26 | 5.25 |
| May 2007 | 4.4 | 2.31 | 5.25 |
| June 2007 | 4.6 | 2.28 | 5.25 |
| July 2007 | 4.7 | 2.07 | 5.25 |
| August 2007 | 4.6 | 1.84 | 5.25 |
| September 2007 | 4.7 | 2.49 | 5.03 |
| October 2007 | 4.7 | 3.06 | 4.74 |
| November 2007 | 4.7 | 3.55 | 4.50 |
| December 2007 | 5.0 | 3.40 | 4.33 |
| January 2008 | 5.0 | 3.35 | 3.98 |
| February 2008 | 4.9 | 3.23 | 3.00 |
| March 2008 | 5.1 | 3.19 | 2.66 |
| April 2008 | 5.0 | 3.24 | 2.24 |
| May 2008 | 5.4 | 3.40 | 2.00 |
| June 2008 | 5.6 | 3.91 | 2.00 |
| July 2008 | 5.8 | 4.20 | 2.00 |
| August 2008 | 6.1 | 4.02 | 2.00 |
| September 2008 | 6.1 | 3.72 | 2.00 |
| October 2008 | 6.5 | 2.86 | 1.56 |
| November 2008 | 6.8 | 1.19 | 1.00 |
| December 2008 | 7.3 | 0.37 | 0.55 |
| January 2009 | 7.8 | 0.18 | 0.13 |
| February 2009 | 8.3 | 0.18 | 0.13 |
| March 2009 | 8.7 | -0.22 | 0.13 |
| April 2009 | 9.0 | -0.32 | 0.13 |
| May 2009 | 9.4 | -0.62 | 0.13 |
| June 2009 | 9.5 | -0.71 | 0.13 |
| July 2009 | 9.5 | -1.18 | 0.13 |
| August 2009 | 9.6 | -0.84 | 0.13 |
| September 2009 | 9.8 | -0.77 | 0.13 |
| October 2009 | 10.0 | 0.08 | 0.13 |
| November 2009 | 9.9 | 1.46 | 0.13 |
| December 2009 | 9.9 | 2.07 | 0.13 |
| January 2010 | 9.8 | 2.19 | 0.13 |
| February 2010 | 9.8 | 1.98 | 0.13 |
| March 2010 | 9.9 | 2.19 | 0.13 |
| April 2010 | 9.9 | 2.02 | 0.13 |
| May 2010 | 9.6 | 1.93 | 0.13 |
| June 2010 | 9.4 | 1.38 | 0.13 |
| July 2010 | 9.4 | 1.55 | 0.13 |
| August 2010 | 9.5 | 1.42 | 0.13 |
| September 2010 | 9.5 | 1.35 | 0.13 |
| October 2010 | 9.4 | 1.27 | 0.13 |
| November 2010 | 9.8 | 1.20 | 0.13 |
| December 2010 | 9.3 | 1.39 | 0.13 |
| January 2011 | 9.2 | 1.43 | 0.13 |
| February 2011 | 9.0 | 1.70 | 0.13 |
| March 2011 | 9.0 | 1.97 | 0.13 |
| April 2011 | 9.1 | 2.43 | 0.13 |
| May 2011 | 9.0 | 2.71 | 0.13 |
| June 2011 | 9.1 | 2.69 | 0.13 |
| July 2011 | 9.0 | 2.77 | 0.13 |
| August 2011 | 9.0 | 2.86 | 0.13 |
| September 2011 | 9.0 | 2.93 | 0.13 |
| October 2011 | 8.8 | 2.75 | 0.13 |
| November 2011 | 8.6 | 2.73 | 0.13 |
| December 2011 | 8.5 | 2.50 | 0.13 |
| January 2012 | 8.3 | 2.57 | 0.13 |
| February 2012 | 8.3 | 2.52 | 0.13 |
| March 2012 | 8.2 | 2.37 | 0.13 |
| April 2012 | 8.2 | 2.06 | 0.13 |
| May 2012 | 8.2 | 1.66 | 0.13 |
| June 2012 | 8.2 | 1.60 | 0.13 |
| July 2012 | 8.2 | 1.44 | 0.13 |
| August 2012 | 8.0 | 1.55 | 0.13 |
| September 2012 | 7.8 | 1.71 | 0.13 |
| October 2012 | 7.8 | 1.94 | 0.13 |
| November 2012 | 7.7 | 1.68 | 0.13 |
| December 2012 | 7.9 | 1.66 | 0.13 |
| January 2013 | 8.0 | 1.52 | 0.13 |
| February 2013 | 7.7 | 1.68 | 0.13 |
| March 2013 | 7.5 | 1.36 | 0.13 |
| April 2013 | 7.6 | 1.12 | 0.13 |
| May 2013 | 7.5 | 1.30 | 0.13 |
| June 2013 | 7.5 | 1.54 | 0.13 |
| July 2013 | 7.3 | 1.61 | 0.13 |
| August 2013 | 7.2 | 1.41 | 0.13 |
| September 2013 | 7.2 | 1.20 | 0.13 |
| October 2013 | 7.2 | 1.04 | 0.13 |
| November 2013 | 7.0 | 1.22 | 0.13 |
| December 2013 | 6.7 | 1.40 | 0.13 |
| January 2014 | 6.6 | 1.40 | 0.13 |
| February 2014 | 6.7 | 1.08 | 0.13 |
| March 2014 | 6.6 | 1.37 | 0.13 |
| April 2014 | 6.2 | 1.66 | 0.13 |
| May 2014 | 6.3 | 1.77 | 0.13 |
| June 2014 | 6.1 | 1.69 | 0.13 |
| July 2014 | 6.2 | 1.71 | 0.13 |
| August 2014 | 6.1 | 1.55 | 0.13 |
| September 2014 | 5.9 | 1.51 | 0.13 |
| October 2014 | 5.7 | 1.40 | 0.13 |
| November 2014 | 5.8 | 1.19 | 0.13 |
| December 2014 | 5.6 | 0.78 | 0.13 |
| January 2015 | 5.7 | 0.16 | 0.13 |
| February 2015 | 5.5 | 0.26 | 0.13 |
| March 2015 | 5.5 | 0.28 | 0.13 |
| April 2015 | 5.4 | 0.15 | 0.13 |
| May 2015 | 5.5 | 0.24 | 0.13 |
| June 2015 | 5.3 | 0.34 | 0.13 |
| July 2015 | 5.3 | 0.30 | 0.13 |
Note: The data are monthly. PCE is personal consumption expenditures.
Source: Federal Reserve Board; U.S. Department of Commerce, Bureau of Economic Analysis; U.S. Department of Labor, Bureau of Labor Statistics.
Figure 5. Measures of Long-Run Expected Inflation and Trend Inflation
| Date | Households | Professional forecasters | Estimated long-term trend |
|---|---|---|---|
| 1981:Q1 | 6.67 | 7.72 | 5.84 |
| 1981:Q2 | ND | 7.47 | 5.21 |
| 1981:Q3 | 6.33 | 7.22 | 4.98 |
| 1981:Q4 | ND | 7.33 | 4.29 |
| 1982:Q1 | 5.67 | 6.76 | 4.11 |
| 1982:Q2 | ND | 6.36 | 4.08 |
| 1982:Q3 | 5.27 | 6.37 | 4.18 |
| 1982:Q4 | ND | 6.20 | 4.06 |
| 1983:Q1 | 4.90 | 5.92 | 4.02 |
| 1983:Q2 | ND | 6.18 | 4.00 |
| 1983:Q3 | 4.97 | 6.23 | 4.10 |
| 1983:Q4 | ND | 6.25 | 4.12 |
| 1984:Q1 | 4.97 | 6.18 | 4.09 |
| 1984:Q2 | ND | 6.10 | 3.95 |
| 1984:Q3 | 4.97 | 5.65 | 3.94 |
| 1984:Q4 | ND | 5.30 | 3.95 |
| 1985:Q1 | 4.73 | 4.95 | 3.99 |
| 1985:Q2 | ND | 5.07 | 3.81 |
| 1985:Q3 | 4.67 | 5.30 | 3.75 |
| 1985:Q4 | ND | 5.21 | 3.79 |
| 1986:Q1 | ND | 4.88 | 3.74 |
| 1986:Q2 | ND | 4.85 | 3.79 |
| 1986:Q3 | ND | 4.72 | 3.87 |
| 1986:Q4 | ND | 4.71 | 3.90 |
| 1987:Q1 | ND | 4.88 | 3.89 |
| 1987:Q2 | ND | 4.90 | 3.86 |
| 1987:Q3 | ND | 5.08 | 3.85 |
| 1987:Q4 | ND | 4.74 | 3.82 |
| 1988:Q1 | ND | 4.84 | 3.85 |
| 1988:Q2 | ND | 4.65 | 3.87 |
| 1988:Q3 | ND | 4.52 | 3.84 |
| 1988:Q4 | ND | 4.27 | 3.85 |
| 1989:Q1 | ND | 4.29 | 3.74 |
| 1989:Q2 | ND | 4.34 | 3.65 |
| 1989:Q3 | ND | 4.13 | 3.57 |
| 1989:Q4 | ND | 3.91 | 3.55 |
| 1990:Q1 | ND | 3.66 | 3.51 |
| 1990:Q2 | 4.30 | 3.87 | 3.33 |
| 1990:Q3 | 4.50 | 3.99 | 3.10 |
| 1990:Q4 | 4.57 | 3.90 | 2.96 |
| 1991:Q1 | 4.60 | 3.91 | 2.93 |
| 1991:Q2 | 4.37 | 3.94 | 2.88 |
| 1991:Q3 | 4.03 | 3.68 | 2.83 |
| 1991:Q4 | 3.77 | 3.60 | 2.73 |
| 1992:Q1 | 3.53 | 3.30 | 2.66 |
| 1992:Q2 | 3.77 | 3.50 | 2.61 |
| 1992:Q3 | 3.80 | 3.35 | 2.58 |
| 1992:Q4 | 3.60 | 3.20 | 2.55 |
| 1993:Q1 | 3.70 | 3.10 | 2.49 |
| 1993:Q2 | 3.60 | 3.30 | 2.42 |
| 1993:Q3 | 3.37 | 3.05 | 2.38 |
| 1993:Q4 | 3.50 | 3.05 | 2.32 |
| 1994:Q1 | 3.30 | 3.05 | 2.28 |
| 1994:Q2 | 3.33 | 3.10 | 2.27 |
| 1994:Q3 | 3.30 | 3.10 | 2.22 |
| 1994:Q4 | 3.23 | 3.10 | 2.18 |
| 1995:Q1 | 3.23 | 2.90 | 2.14 |
| 1995:Q2 | 3.27 | 2.95 | 2.10 |
| 1995:Q3 | 3.13 | 2.80 | 2.08 |
| 1995:Q4 | 3.13 | 2.60 | 2.06 |
| 1996:Q1 | 3.23 | 2.60 | 2.03 |
| 1996:Q2 | 3.13 | 2.60 | 2.01 |
| 1996:Q3 | 3.23 | 2.60 | 1.99 |
| 1996:Q4 | 3.00 | 2.60 | 1.98 |
| 1997:Q1 | 3.10 | 2.60 | 1.96 |
| 1997:Q2 | 3.00 | 2.45 | 1.95 |
| 1997:Q3 | 3.00 | 2.60 | 1.91 |
| 1997:Q4 | 3.07 | 2.25 | 1.90 |
| 1998:Q1 | 2.87 | 2.20 | 1.88 |
| 1998:Q2 | 2.80 | 2.10 | 1.86 |
| 1998:Q3 | 2.77 | 2.10 | 1.86 |
| 1998:Q4 | 2.83 | 2.10 | 1.85 |
| 1999:Q1 | 2.83 | 1.90 | 1.83 |
| 1999:Q2 | 2.83 | 2.10 | 1.83 |
| 1999:Q3 | 2.87 | 2.10 | 1.82 |
| 1999:Q4 | 2.87 | 2.10 | 1.81 |
| 2000:Q1 | 3.00 | 2.10 | 1.80 |
| 2000:Q2 | 2.83 | 2.10 | 1.78 |
| 2000:Q3 | 2.90 | 2.10 | 1.78 |
| 2000:Q4 | 2.97 | 2.10 | 1.77 |
| 2001:Q1 | 2.97 | 2.10 | 1.77 |
| 2001:Q2 | 3.03 | 2.10 | 1.76 |
| 2001:Q3 | 2.93 | 2.10 | 1.75 |
| 2001:Q4 | 2.83 | 2.15 | 1.74 |
| 2002:Q1 | 2.77 | 2.10 | 1.76 |
| 2002:Q2 | 2.87 | 2.10 | 1.76 |
| 2002:Q3 | 2.73 | 2.10 | 1.77 |
| 2002:Q4 | 2.80 | 2.05 | 1.77 |
| 2003:Q1 | 2.73 | 2.10 | 1.77 |
| 2003:Q2 | 2.73 | 2.10 | 1.79 |
| 2003:Q3 | 2.70 | 2.10 | 1.81 |
| 2003:Q4 | 2.77 | 2.10 | 1.83 |
| 2004:Q1 | 2.87 | 2.10 | 1.84 |
| 2004:Q2 | 2.80 | 2.10 | 1.85 |
| 2004:Q3 | 2.77 | 2.10 | 1.87 |
| 2004:Q4 | 2.77 | 2.10 | 1.89 |
| 2005:Q1 | 2.80 | 2.05 | 1.91 |
| 2005:Q2 | 2.90 | 2.10 | 1.92 |
| 2005:Q3 | 2.93 | 2.10 | 1.93 |
| 2005:Q4 | 3.10 | 2.10 | 1.94 |
| 2006:Q1 | 2.90 | 2.10 | 1.94 |
| 2006:Q2 | 3.07 | 2.10 | 1.93 |
| 2006:Q3 | 3.03 | 2.10 | 1.91 |
| 2006:Q4 | 3.03 | 2.10 | 1.89 |
| 2007:Q1 | 2.93 | 2.00 | 1.87 |
| 2007:Q2 | 3.03 | 2.00 | 1.84 |
| 2007:Q3 | 2.97 | 2.10 | 1.84 |
| 2007:Q4 | 2.93 | 2.10 | 1.83 |
| 2008:Q1 | 2.97 | 2.20 | 1.83 |
| 2008:Q2 | 3.33 | 2.20 | 1.82 |
| 2008:Q3 | 3.13 | 2.20 | 1.81 |
| 2008:Q4 | 2.80 | 2.20 | 1.82 |
| 2009:Q1 | 2.87 | 2.20 | 1.82 |
| 2009:Q2 | 2.90 | 2.28 | 1.83 |
| 2009:Q3 | 2.87 | 2.15 | 1.83 |
| 2009:Q4 | 2.87 | 2.10 | 1.84 |
| 2010:Q1 | 2.77 | 2.10 | 1.87 |
| 2010:Q2 | 2.80 | 2.15 | 1.88 |
| 2010:Q3 | 2.80 | 2.11 | 1.90 |
| 2010:Q4 | 2.80 | 2.00 | 1.92 |
| 2011:Q1 | 3.00 | 2.10 | 1.94 |
| 2011:Q2 | 2.93 | 2.27 | 1.97 |
| 2011:Q3 | 2.87 | 2.25 | 1.98 |
| 2011:Q4 | 2.70 | 2.16 | 2.00 |
| 2012:Q1 | 2.87 | 2.15 | 2.00 |
| 2012:Q2 | 2.80 | 2.20 | 1.99 |
| 2012:Q3 | 2.83 | 2.20 | 2.00 |
| 2012:Q4 | 2.80 | 2.10 | 2.00 |
| 2013:Q1 | 2.90 | 2.00 | 1.99 |
| 2013:Q2 | 2.90 | 2.00 | 2.00 |
| 2013:Q3 | 2.90 | 2.00 | 1.99 |
| 2013:Q4 | 2.80 | 2.00 | 1.99 |
| 2014:Q1 | 2.90 | 2.00 | 1.99 |
| 2014:Q2 | 2.87 | 2.00 | 1.99 |
| 2014:Q3 | 2.80 | 2.00 | 1.99 |
| 2014:Q4 | 2.73 | 2.00 | 2.01 |
| 2015:Q1 | 2.77 | 2.00 | 2.02 |
| 2015:Q2 | 2.67 | 1.98 | 2.04 |
ND: No data. Return to table
Note: The data are quarterly.
Source: Source: For households, median long-term expectations from the University of Michigan Surveys of Consumers; for professional forecasters, expectations derived from a survey conducted by Richard Hoey and from the Survey of Professional Forecasters, conducted by the Federal Reserve Bank of Philadelphia.
Figure 6. Inflation Expectations and the Effect of an Import Price Increase
Panel A. Unanchored Inflation Expectations
| Quarter | Level of relative import price | Core PCE price inflation |
|---|---|---|
| -4 | 100.00 | 2.00 |
| -3 | 100.00 | 2.00 |
| -2 | 100.00 | 2.00 |
| -1 | 100.00 | 2.00 |
| 0 | 100.25 | 2.03 |
| 1 | 100.75 | 2.08 |
| 2 | 101.49 | 2.15 |
| 3 | 102.47 | 2.24 |
| 4 | 103.45 | 2.32 |
| 5 | 104.22 | 2.38 |
| 6 | 104.74 | 2.41 |
| 7 | 105.00 | 2.43 |
| 8 | 105.00 | 2.42 |
| 9 | 105.00 | 2.43 |
| 10 | 105.00 | 2.43 |
| 11 | 105.00 | 2.43 |
| 12 | 105.00 | 2.43 |
| 13 | 105.00 | 2.43 |
| 14 | 105.00 | 2.43 |
| 15 | 105.00 | 2.43 |
| 16 | 105.00 | 2.43 |
Source: Calculations by Federal Reserve Board staff based on calibrated inflation models.
Panel B. Anchored Inflation Expectations
| Quarter | Level of relative import price | Core PCE price inflation |
|---|---|---|
| -4 | 100.00 | 2.00 |
| -3 | 100.00 | 2.00 |
| -2 | 100.00 | 2.00 |
| -1 | 100.00 | 2.00 |
| 0 | 100.25 | 2.06 |
| 1 | 100.75 | 2.14 |
| 2 | 101.49 | 2.25 |
| 3 | 102.47 | 2.36 |
| 4 | 103.45 | 2.43 |
| 5 | 104.22 | 2.42 |
| 6 | 104.74 | 2.37 |
| 7 | 105.00 | 2.29 |
| 8 | 105.00 | 2.19 |
| 9 | 105.00 | 2.14 |
| 10 | 105.00 | 2.09 |
| 11 | 105.00 | 2.06 |
| 12 | 105.00 | 2.04 |
| 13 | 105.00 | 2.03 |
| 14 | 105.00 | 2.02 |
| 15 | 105.00 | 2.01 |
| 16 | 105.00 | 2.01 |
Note: The FOMC longer-run goal is shown as a dotted horizontal line at 2.00.
Source: Calculations by Federal Reserve Board staff based on calibrated inflation models.
Figure 7. Are Long-Run Inflation Expectations Anchored?
| Date | Households | Professional forecasters | Inflation compensation from TIPS |
|---|---|---|---|
| 1981:Q1 | 6.67 | 7.72 | ND |
| 1981:Q2 | ND | 7.47 | ND |
| 1981:Q3 | 6.33 | 7.22 | ND |
| 1981:Q4 | ND | 7.33 | ND |
| 1982:Q1 | 5.67 | 6.76 | ND |
| 1982:Q2 | ND | 6.36 | ND |
| 1982:Q3 | 5.27 | 6.37 | ND |
| 1982:Q4 | ND | 6.20 | ND |
| 1983:Q1 | 4.90 | 5.92 | ND |
| 1983:Q2 | ND | 6.18 | ND |
| 1983:Q3 | 4.97 | 6.23 | ND |
| 1983:Q4 | ND | 6.25 | ND |
| 1984:Q1 | 4.97 | 6.18 | ND |
| 1984:Q2 | ND | 6.10 | ND |
| 1984:Q3 | 4.97 | 5.65 | ND |
| 1984:Q4 | ND | 5.30 | ND |
| 1985:Q1 | 4.73 | 4.95 | ND |
| 1985:Q2 | ND | 5.07 | ND |
| 1985:Q3 | 4.67 | 5.30 | ND |
| 1985:Q4 | ND | 5.21 | ND |
| 1986:Q1 | ND | 4.88 | ND |
| 1986:Q2 | ND | 4.85 | ND |
| 1986:Q3 | ND | 4.72 | ND |
| 1986:Q4 | ND | 4.71 | ND |
| 1987:Q1 | ND | 4.88 | ND |
| 1987:Q2 | ND | 4.90 | ND |
| 1987:Q3 | ND | 5.08 | ND |
| 1987:Q4 | ND | 4.74 | ND |
| 1988:Q1 | ND | 4.84 | ND |
| 1988:Q2 | ND | 4.65 | ND |
| 1988:Q3 | ND | 4.52 | ND |
| 1988:Q4 | ND | 4.27 | ND |
| 1989:Q1 | ND | 4.29 | ND |
| 1989:Q2 | ND | 4.34 | ND |
| 1989:Q3 | ND | 4.13 | ND |
| 1989:Q4 | ND | 3.91 | ND |
| 1990:Q1 | ND | 3.66 | ND |
| 1990:Q2 | 4.30 | 3.87 | ND |
| 1990:Q3 | 4.50 | 3.99 | ND |
| 1990:Q4 | 4.57 | 3.90 | ND |
| 1991:Q1 | 4.60 | 3.91 | ND |
| 1991:Q2 | 4.37 | 3.94 | ND |
| 1991:Q3 | 4.03 | 3.68 | ND |
| 1991:Q4 | 3.77 | 3.60 | ND |
| 1992:Q1 | 3.53 | 3.30 | ND |
| 1992:Q2 | 3.77 | 3.50 | ND |
| 1992:Q3 | 3.80 | 3.35 | ND |
| 1992:Q4 | 3.60 | 3.20 | ND |
| 1993:Q1 | 3.70 | 3.10 | ND |
| 1993:Q2 | 3.60 | 3.30 | ND |
| 1993:Q3 | 3.37 | 3.05 | ND |
| 1993:Q4 | 3.50 | 3.05 | ND |
| 1994:Q1 | 3.30 | 3.05 | ND |
| 1994:Q2 | 3.33 | 3.10 | ND |
| 1994:Q3 | 3.30 | 3.10 | ND |
| 1994:Q4 | 3.23 | 3.10 | ND |
| 1995:Q1 | 3.23 | 2.90 | ND |
| 1995:Q2 | 3.27 | 2.95 | ND |
| 1995:Q3 | 3.13 | 2.80 | ND |
| 1995:Q4 | 3.13 | 2.60 | ND |
| 1996:Q1 | 3.23 | 2.60 | ND |
| 1996:Q2 | 3.13 | 2.60 | ND |
| 1996:Q3 | 3.23 | 2.60 | ND |
| 1996:Q4 | 3.00 | 2.60 | ND |
| 1997:Q1 | 3.10 | 2.60 | ND |
| 1997:Q2 | 3.00 | 2.45 | ND |
| 1997:Q3 | 3.00 | 2.60 | ND |
| 1997:Q4 | 3.07 | 2.25 | ND |
| 1998:Q1 | 2.87 | 2.20 | ND |
| 1998:Q2 | 2.80 | 2.10 | ND |
| 1998:Q3 | 2.77 | 2.10 | ND |
| 1998:Q4 | 2.83 | 2.10 | ND |
| 1999:Q1 | 2.83 | 1.90 | 1.94 |
| 1999:Q2 | 2.83 | 2.10 | 2.25 |
| 1999:Q3 | 2.87 | 2.10 | 2.61 |
| 1999:Q4 | 2.87 | 2.10 | 2.70 |
| 2000:Q1 | 3.00 | 2.10 | 2.42 |
| 2000:Q2 | 2.83 | 2.10 | 2.27 |
| 2000:Q3 | 2.90 | 2.10 | 2.11 |
| 2000:Q4 | 2.97 | 2.10 | 2.09 |
| 2001:Q1 | 2.97 | 2.10 | 2.15 |
| 2001:Q2 | 3.03 | 2.10 | 2.48 |
| 2001:Q3 | 2.93 | 2.10 | 2.34 |
| 2001:Q4 | 2.83 | 2.15 | 2.50 |
| 2002:Q1 | 2.77 | 2.10 | 2.68 |
| 2002:Q2 | 2.87 | 2.10 | 2.76 |
| 2002:Q3 | 2.73 | 2.10 | 2.76 |
| 2002:Q4 | 2.80 | 2.05 | 2.75 |
| 2003:Q1 | 2.73 | 2.10 | 2.74 |
| 2003:Q2 | 2.73 | 2.10 | 2.47 |
| 2003:Q3 | 2.70 | 2.10 | 2.92 |
| 2003:Q4 | 2.77 | 2.10 | 3.11 |
| 2004:Q1 | 2.87 | 2.10 | 2.88 |
| 2004:Q2 | 2.80 | 2.10 | 3.11 |
| 2004:Q3 | 2.77 | 2.10 | 2.90 |
| 2004:Q4 | 2.77 | 2.10 | 2.79 |
| 2005:Q1 | 2.80 | 2.05 | 2.70 |
| 2005:Q2 | 2.90 | 2.10 | 2.57 |
| 2005:Q3 | 2.93 | 2.10 | 2.48 |
| 2005:Q4 | 3.10 | 2.10 | 2.59 |
| 2006:Q1 | 2.90 | 2.10 | 2.55 |
| 2006:Q2 | 3.07 | 2.10 | 2.69 |
| 2006:Q3 | 3.03 | 2.10 | 2.66 |
| 2006:Q4 | 3.03 | 2.10 | 2.56 |
| 2007:Q1 | 2.93 | 2.00 | 2.49 |
| 2007:Q2 | 3.03 | 2.00 | 2.54 |
| 2007:Q3 | 2.97 | 2.10 | 2.69 |
| 2007:Q4 | 2.93 | 2.10 | 2.76 |
| 2008:Q1 | 2.97 | 2.20 | 2.94 |
| 2008:Q2 | 3.33 | 2.20 | 2.85 |
| 2008:Q3 | 3.13 | 2.20 | 2.81 |
| 2008:Q4 | 2.80 | 2.20 | 2.77 |
| 2009:Q1 | 2.87 | 2.20 | 2.49 |
| 2009:Q2 | 2.90 | 2.28 | 2.76 |
| 2009:Q3 | 2.87 | 2.15 | 3.06 |
| 2009:Q4 | 2.87 | 2.10 | 3.12 |
| 2010:Q1 | 2.77 | 2.10 | 3.09 |
| 2010:Q2 | 2.80 | 2.15 | 2.91 |
| 2010:Q3 | 2.80 | 2.11 | 2.51 |
| 2010:Q4 | 2.80 | 2.00 | 2.91 |
| 2011:Q1 | 3.00 | 2.10 | 2.93 |
| 2011:Q2 | 2.93 | 2.27 | 2.90 |
| 2011:Q3 | 2.87 | 2.25 | 2.81 |
| 2011:Q4 | 2.70 | 2.16 | 2.42 |
| 2012:Q1 | 2.87 | 2.15 | 2.56 |
| 2012:Q2 | 2.80 | 2.20 | 2.57 |
| 2012:Q3 | 2.83 | 2.20 | 2.54 |
| 2012:Q4 | 2.80 | 2.10 | 2.76 |
| 2013:Q1 | 2.90 | 2.00 | 2.81 |
| 2013:Q2 | 2.90 | 2.00 | 2.63 |
| 2013:Q3 | 2.90 | 2.00 | 2.58 |
| 2013:Q4 | 2.80 | 2.00 | 2.59 |
| 2014:Q1 | 2.90 | 2.00 | 2.49 |
| 2014:Q2 | 2.87 | 2.00 | 2.44 |
| 2014:Q3 | 2.80 | 2.00 | 2.41 |
| 2014:Q4 | 2.73 | 2.00 | 2.11 |
| 2015:Q1 | 2.77 | 2.00 | 1.85 |
| 2015:Q2 | 2.67 | 1.98 | 2.02 |
| 2015:Q3 | ND | 2.00 | 2.00 |
ND: No data. Return to table
Note: The data are quarterly. Inflation compensation is 5-year, 5-year-forward breakeven (2015:Q3 observation is July–August average). The data for households start in 1990:Q2, and those for inflation compensation start in 1999:Q1. TIPS is Treasury Inflation-Protected Securities.
Source: For households, median long-term expectations from the University of Michigan Surveys of Consumers; for professional forecasters, expectations derived from a survey conducted by Richard Hoey and from the Survey of Professional Forecasters, conducted by the Federal Reserve Bank of Philadelphia.
Figure 8. Why Has PCE Inflation Fallen below 2 Percent?
| Date | Total shortfall | Contribution of relative energy prices | Contribution of relative import prices | Contribution of slack | Contribution of other factors |
|---|---|---|---|---|---|
| 2000-2007 average | 0.16 | 0.35 | -0.06 | 0.00 | -0.13 |
| 2008-2012 average | -0.32 | 0.07 | 0.05 | -0.56 | 0.11 |
| 2013 | -0.78 | -0.23 | -0.30 | -0.50 | 0.25 |
| 2014 | -0.88 | -0.42 | -0.19 | -0.31 | 0.04 |
| 2015 (estimated) | -1.60 | -0.80 | -0.54 | -0.13 | -0.13 |
Note: Deviation of PCE inflation (fourth quarter to fourth quarter) from 2 percent, total and portion attributable to specific factors. Other factors includes the effects of changes in relative food prices.
Source: Federal Reserve Board staff calculations. See the appendix for further details.
Figure 9. Actual and Expected Inflation in Japan
Series: 12-month percent change and five-year percent change (at annual rate) in the All Japan General Consumer Price Index; Consensus Forecasts projection for Japan long-term expected inflation (average annual inflation expected 6 to 10 years ahead), percent.
Horizon: January 1991 to June 2015 (consumer price index changes); April 1991 to June 2015 (Consensus Forecasts data on long-term expected inflation).
Description: The data for the 12-month and five-year price changes are monthly; the Consensus Forecasts long-term expected inflation data are semiannual through April 2014 and quarterly thereafter. All series are in percent. The 12-month price change is about 4 percent at the start of 1991, and falls to around zero by the mid-1990s. Thereafter, the 12-month change fluctuates around zero, with brief periods of positive inflation in the late 1990s and late 2000s and a large positive bulge in inflation from late 2013 through early 2015. The average five-year price change becomes generally negative in the early 2000s, and is only positive around the end of the decade and since the middle of 2014. Long-term expected inflation is close to the average five-year price change through the mid-1990s; thereafter, a gap opens up between the average five-year price change and long-term expected inflation. From the mid-2000s and after, long-term expected inflation is roughly constant at a little above 1 percent and the actual average five-year price change is typically slightly below zero.
Source: Ministry of Internal Affairs and Communications (Japan); Consensus Economics (London); Haver Analytics.
Last Update:
September 24, 2015