Friday, July 18, 2014

US inflation predictions

If you looked carefully at the previous post, you might have noticed that the lines extended a bit beyond 2014. That was because I was also going to produce some inflation predictions for the US using the same procedure. Here is US inflation out to 2020 using predictors 5-20 years back (they turn out to be mostly consistent):

The same caveats apply as in this prediction of Canadian inflation: this assumes the log-linear extrapolation of NGDP and M0 using the prior 10 years holds.

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Also, try to avoid the use of dollar signs as they interfere with my setup of mathjax. I left it set up that way because I think this is funny for an economics blog. You can use € or £ instead.