NEW YORK — On Thursday, July 6, at 11:00 AM EDT, the Federal Reserve Bank of New York will begin monthly publication of a new research product that estimates inflation persistence.
The Multivariate Core Trend (MCT) model measures inflation’s persistence in the seventeen core sectors of the personal consumption expenditures (PCE) price index.
Whether inflation is short-lived or persistent, concentrated in a few sectors or broad-based, is of deep relevance to policymakers. The MCT model estimates a dynamic factor model on monthly data for the major sectors of the PCE price index to assess the extent of inflation persistence and its broadness. The results – known as MCT Inflation – give a measure of trend inflation and shed light on whether inflation dynamics are dominated by a trend common across sectors or are sector-specific.
MCT Inflation was first introduced through a Liberty Street Economics blog post in April 2022. Subsequently, starting in January 2023, the economists have published monthly summaries on Liberty Street Economics leveraging the model.
Once publication begins, MCT Inflation will publish on or shortly after 2:00 PM on the first Tuesday after the release of the PCE price index from the Bureau of Economic Analysis.
Press Call on MCT Inflation
In connection with the launch of regular publication of MCT Inflation, the associated economists will be available for a deep background press call on Thursday, July 6 at 10:00 AM EDT to provide further context on the product and its use. Journalists interested in participating should RSVP to Connor Munsch at Connor.Munsch@ny.frb.org.
