Monitoring the Inflationary Effects of COVID-19

Shapiro, Adam Hale

Journal Article

Monitoring the Inflationary Effects of COVID-19

Abstract: Inflation fell dramatically following the onset of the COVID-19 pandemic. Dividing the underlying price data according to spending category reveals that a majority of the drop in core personal consumption expenditures inflation comes from a large decline in consumer demand. This demand effect far outweighs upward price pressure from COVID-related supply constraints. A new monthly data page from the San Francisco Fed tracks how sensitivity to the economic disruptions of COVID-19 affects different categories of inflation over time.

Keywords: inflation; covid-19;