Cross Country Core CPI Trends

Core CPI has accelerated in many countries.

Using Ha, Kose and Ohnsorge (World Bank) database:

Figure 1: Core CPI, s.a., in logs 2021M03=0. Australia series, n.s.a., interpolated from quarterly data by author. NBER defined recession dates peak-to-trough shaded gray. Source: Ha, Kose, Ohnsorge/World Bank, OECD (for Australia) via FRED, NBER, and author’s calculations.

This database is described in this post.

And using OECD (mostly) data:

Figure 2: Core CPI, n.s.a., in logs 2021M03=0. US series is BLS, s.a.. China series, s.a., from Ha et al. French series excludes tobacco and alcohol. Australia series interpolated from quarterly data by author. NBER defined recession dates peak-to-trough shaded gray. Source: BLS, OECD via FRED, Ha, Kose, Ohnsorge/World Bank, NBER, and author’s calculations.

So, while cumulative US core inflation is high, other countries’ cumulative inflation is also up. UK, Canada, and Australia are the closest (once again, anglophone countries!).

It’s important to keep in mind that US inflation was higher than all the countries plotted, pre-pandemic. That’s why I did diffs-in-diffs in my previous assessments.