Pertinent Category: Archive

– February 26, 2015

The Everyday Price Index (EPI) decreased 1.5 percent in January in contrast to the Consumer Price Index (CPI) which decreased 0.7 percent.

Business Conditions

February Business Conditions Monthly

AIER Staff

– February 24, 2015

A strengthening U.S. dollar is having far-reaching effects on the U.S. economy and global markets.

ECONOMY

– February 24, 2015

The Strengthening Dollar The dollar has risen about 15 percent against a broad basket of global currencies since touching a low in July 2011, with much of the gain coming during the second half of last year. For the economy, the effects of currency appreciation are transmitted most directly through trade flows, meaning U.S. imports from other countries and U.S. exports to other nations.

Inflation

– February 24, 2015

Scorecard In the latest update of AIER’s Inflationary Pressures Scorecard, on balance, pressures have risen. Nine of the 23 indicators tracked in the scorecard are showing rising pressure compared with seven last month. The first of the indicators that is now showing increased pressures is from the demand section of our scorecard. It is personal income. Personal income growth has accelerated to a 4.0 percent rate for the three months through December versus a 3.0 percent rate for the prior three-month period.

Research Briefs

Rewards & Rigors of Summer Fellowship

Natalia Smirnova, PhD

– February 11, 2015

AIER’s Summer Fellowship program has long been a core component of the Institute’s mission to inform and educate the public. The program has been a part of AIER since the organization’s post-World War II move to the Berkshires in 1946. From the beginning, the goal has been to introduce the next generation of economists to the nonpartisan, scientific methods of data analysis that are AIER’s trademark.

Business Conditions

January Business Conditions Monthly

AIER Staff

– January 21, 2015

Changing global oil market dynamics send prices tumbling, helping some while hurting others and shifting investment prospects.

Economy

– January 21, 2015

Energy and the Economy The drop in crude oil prices has been a net positive for the U.S. economy but the impact may not be as big as some people believe. The benchmark price of a barrel of U.S. crude fell about 50 percent from a high of $107.95 in June to $53.27 on December 31. Meanwhile, the average pump price of a gallon of gasoline in the U.S. slid 37 percent from about $3.79 to $2.39. While this decline is certainly welcome by consumers and a positive for their confidence in the economy, the actual dollar impact is relatively small.

Inflation

– January 21, 2015

Scorecard AIER has created an inflationary pressures scorecard to help monitor those trends that we believe contribute to the development of inflation. Our scorecard tracks 23 indicators and evaluates the performance of each over the past three months compared with the prior three months. That is, we compute moving averages of the monthly changes for two consecutive, non-overlapping three-month periods and calculate the difference between the averages. A positive difference shows an upward trend while a negative value indicates a downward trend. We then interpret the impact with respect to price pressures.

Policy

– January 21, 2015

Monetary On Sept. 13, 2012, the rate-setting Federal Open Market Committee issued its regular post-meeting statement and included this comment: “To support continued progress toward maximum employment and price stability, the Committee expects that a highly accommodative stance of monetary policy will remain appropriate for a considerable time after the economic recovery strengthens.” That was the first time that the key phrase “considerable time” was used. That phrase was included in every subsequent statement until Dec. 17, when the FOMC said: “Based on its current assessment, the Committee judges that it can be patient in beginning to normalize the stance of monetary policy.” That change in language is significant because the phrase “considerable time” was interpreted by most analysts, economist and investors to mean about six months following the end of the Federal Reserve’s asset purchase program, known as quantitative easing (QE). As the six month mark approaches in the first half of 2015, investors would naturally begin to anticipate a rate increase. However, we believe that with this new language the Fed has introduced some uncertainty regarding the timing of interest rate increases.

Everyday Price Index