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Seasonal Adjustments and Inflation

Posted on May 21, 2008

Yesterday, we spilled quite a few pixels discussing the various ways inflation has been impacting the economy. Not only did we see Core Producer Prices spike 0.4% for April, but Crude Oil broke $129 (now over $130). This leaves manufacturers facing the unpleasant choice of raising prices, or squeezing margins. But it has been the BLS seasonal adjustments that caused the most angst lately. April PPI and CPI have built in expectations of a seasonal rise in energy prices. BLS' goal is to report actual changes, not temporary ones. But problems can arise in this methodology, especially when you hav...

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crude , data , economy , federal reserve , gas , oil , petroleum