US Monthly Economic Indicators (Through August 2025) US core consumer price inflation rate (excluding food and energy) is trending at 3.5% annualized and accelerating. The Fed's favorite inflation metric, core personal consumption expenditures price inflation rate (excluding food and energy) is trending at 2.7% and decelerating. Both measures are above the Fed's 2% target, but their trends are diverging. Volatile producer price inflation is trending at 4.1% and decelerating. Average hourly earnings change is trending flat at 3.5% annualized. Unemployment rate is trending up slightly at 4.3%. The rate-of-change trend in total payroll employment is slightly negative. On the activity side, Industrial Production (real) change and Housing Starts (real) change are trending down while Retail Sales (nominal) change is trending up. It appears that consumers are still spending, notwithstanding concerns about inflation, jobs, housing, and personal finances. Money supply M2 change is trending up, reflecting consistent loosening by the Fed and a recent 0.25% cut in the Fed Funds Rate. Trump doesn't seem to know what a friend he has in Powell. Two-year and ten-year Treasury yield trends are divergent and non-inverted, which is healthy. The most recent daily Treasury rate figures are 3.6% for 2-year and 4.2% for 10-year, again non-inverted. Conference Board's Leading Economic Index dropped in June, driven by current economic flux and uncertainties. Our Simple Macro Model forecasts trend real growth and quiet inflation over the next few quarters, but that picture could obviously change as we move forward. Consumer Sentiment dropped sharply in September, again reflecting economic uncertainty.
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