The Unreliability of Inflation Indicators - FEDERAL RESERVE BANK of NEW YORK

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Current Issues in Economics and Finance

The Unreliability of Inflation Indicators

April 2000 Volume 6, Number 4

JEL classification: E31, E37

Authors: Stephen G. Cecchetti, Rita S. Chu, and Charles Steindel

Analysts seeking evidence of rising inflation often focus on the movements of a single indicator-an increase in the price of gold, for example, or a decline in the unemployment rate. But simple statistical tests reveal that such indicators, used in isolation, have very limited predictive power.

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6 pages / 126 kb

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