Journal Article

Commodity price movements and PCE inflation


Abstract: With the recent run-up in crop and energy prices - and the subsequent sharp reversal of these trends - the effects of commodity price movements on U.S. inflation merit renewed attention. A study of the contributions of grain and oil prices to the PCE index of inflation suggests that the effects are more modest than one might expect. Moreover, commodity price increases affect relatively few goods prices: Higher crop prices translate narrowly into price hikes for food, tobacco, and gardening supplies; rising oil prices mainly influence fuel, energy, and transportation prices.

Access Documents

Authors

Bibliographic Information

Provider: Federal Reserve Bank of New York

Part of Series: Current Issues in Economics and Finance

Publication Date: 2008

Volume: 14

Issue: Nov

Order Number: 8