:: Monday, March 15, 2010

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There is a lot of concern about inflation. Most of it is based on perusing the following numbers of the year-on-year changes in price indexes:

Jul
Aug
Sep
Oct

CPI (IW)
11.9
11.7
11.6
11.5

WPI
-0.7
-0.2
0.5
1.3

WPI Food
13.3
14.0
15.7
13.4

WPI fruits,vegs
15.5
12.0
24.6
11.1

True inflation in India is somewhere between the CPI-IW (which overstates the importance of food) and the WPI (which overstates the importance of tradeables and thus the exchange [...]

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David O. Meltzer and Zhuo Chen explored the relationship between minimum wage rate in the U.S and body weight (link):
“Growing consumption of increasingly less expensive food, and especially “fast food”, has been cited as a potential cause of increasing rate of obesity in the United States over the past several decades. Because the real minimum [...]

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The progress of the 2009 monsoon seems to be 29% below normal. This may be adversely affecting food prices. In the latest available data, inflation based on CPI-IW has surged back to values near 10%. (This is the three-month moving average of the rate of change of seasonally adjusted [...]

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