**Where Is Inflation Headed? Nine Signs to Watch**
**Economists are especially interested in what current price pressures bode for the longer term**
**By Gwynn Guilford, The Wall Street Journal, May 24, 2022**
**Short-Term Inflation Momentum - three-month annualized rate.**
**Underlying Inflation - Federal Reserve Bank of Cleveland’s 16% trimmed-mean CPI, which lops off the most extreme price changes, and its median CPI, which shows the middle-most price change.**
**End of the Goods Binge - track the balance of the two broad spending categories (goods and services) in the Commerce Department’s monthly personal-consumption expenditures report.**
**Hot Labor Market - Atlanta Fed’s wage tracker**
**Rent Costs - Zillow’s observed rent index and Apartment List’s rent estimate**
**Autos Are Clutch - Manheim’s used-vehicle value index, which tends to lead the CPI series by a month or two.**
**Oil Futures - Watching the prices on contracts for future deliveries of West Texas Intermediate, the U.S. benchmark for crude oil, offers a rough guide to where gasoline prices may be months or a year from now.**
**Inflation Expectations - median expectation of inflation five to 10 years from now, drawn from the University of Michigan’s monthly survey of consumers.** [end quote]
These are some good indicators. I’ll add them to the Control Panel if I can find them.
The market’s inflation expectation is shown by the 5-Year, 5-Year Forward Inflation Expectation Rate. It’s currently 2.28% and dropping. The bond market seems to have confidence that the Fed will be able to bring inflation back to their target within 5 years.