Inflation as measured by the core personal consumption expenditure (PCE) price index, a so-called chain-weight index that has the advantage of allowing for shifting expenditure weights, also fell, though less dramatically, from 1.7 percent in the year ending May 2002 to 1.2 percent in the year ending May 2003 (June data are not yet available), a fall of 0.5 percentage 3 points.
Indeed, the economic journalists’ most frequent question these days is some variant of: “How long will it last?” “Is the good news temporary or permanent?” I get this question all the time, as do all members of the Federal Open Market Committee. Hope springs eternal that we may be privy to some secret economic clues available only to readers of entrails inside the temple.