U.S. Future Inflation Gauge: A Primer
ECRI | Jul 7, 2017

ECRI’s U.S. Future Inflation Gauge (USFIG) leads U.S. inflation cycle turning points. There is both a monthly and a weekly version of the gauge. Monthly historical data begins in 1948; the weekly historical data begins in 1989.

The value of the USFIG lies in its ability to measure underlying inflationary pressures and thereby predict turning points in the U.S. inflation cycle.

The 2016 upturn in the USFIG foreshadowed the upturn in U.S. inflation pressures. Therefore, even though market inflation expectations had dropped to multiyear lows that summer, we knew that a cyclical upturn in inflation was at hand. Now the USFIG’s direction has started to reverse.

The USFIG is a more direct measure of inflation pressures that is not based on an econometric model, but is rooted in a very different paradigm. It is comprised of leading indicators reflecting the fundamental drivers of the inflation cycle.