The US economy, release by release.
Every number that moves markets, what the last one told us and where the next one should land. Each forecast is built from public prices and data, refit every month, and scored against the Wall Street consensus on the number first published.
Core inflation is running 3.4% annualized over three months against 2.6% over a year, payrolls have averaged 51k a month with unemployment at 4.2%, and 2026 Q3 growth is tracking 3.5%. Policy sits at 3.75–4.00%, about 0.9 points above core PCE inflation.
Six things the data say right now
- Regime: Reflation. Growth and inflation are both picking up, the mix that pushes yields higher.
- Inflation: core CPI is running 3.4% annualized over three months against 2.6% over a year; services ex shelter 3.3%, shelter 3.2%. The model calls October 2026 core CPI at +0.22%.
- Jobs: all four recession warning lights are green; the Sahm rule reads 0.00 pt. The model calls October 2026 payrolls at +93k with unemployment 4.15%.
- Surprises: Growth data have come in above forecasts (index +0.11; over four months 5 releases beat, 5 missed, 2 matched), and inflation data in line with forecasts (index −0.04; 4 hotter, 11 cooler, 8 as expected).
- Policy: At 3.75–4.00% the policy rate is 0.9 pt above core PCE inflation and 66 bp below a simple Taylor rule (4.54%). The 2-year Treasury at 4.69% sits 82 bp above the funds rate, so markets lean toward higher rates over the next two years.
- Biggest expected swing: the model sees CPI for October 2026 at +0.23%, down from +0.65% last time. The consensus is usually published a few days before the release.
Where things stand
Four questions markets keep asking, answered from the latest data. Each status follows a stated rule, shown beneath it.
Inflation Re-accelerating
Re-accelerating when the 3-month pace runs 0.3 pt above the 12-month pace; cooling when 0.3 pt below.
CPI forecast and breakdownLabor market Solid
Cooling when unemployment is up 0.3 pt on the year or payrolls average under 50k; strong above 150k.
Jobs forecast and breakdownGrowth Above trend
Above trend when the current-quarter tracking estimate is 2.5% or more; soft below 1%.
GDP trackerPolicy Mildly restrictive
Restrictive when the policy rate is more than 1.5 pt above core PCE inflation.
PCE, the Fed's gaugeThe macro map
Where growth and inflation momentum have taken the economy over the past year, and whether the data have been beating Wall Street's forecasts.
Growth and inflation momentum
As of September 2026 the data put the economy in reflation, though close to the middle of the map: growth and inflation are both picking up, the mix that pushes yields higher. Growth momentum is +0.2 standard deviations (biggest push: jobless claims, +0.5) and inflation momentum +0.1 (biggest push: core CPI, +1.5). A year ago it was disinflationary slowdown.
How the map is built
Growth: payrolls (3-month vs 12-month average), unemployment (3-month vs 12-month, inverted), retail control group (3-month vs 12-month annualized) and initial jobless claims (year over year, inverted). Inflation: core CPI, CPI services ex shelter and hourly earnings (3-month vs 12-month annualized). Each is scaled by its own history excluding 2020–21 and averaged.
Key Data surprise index
Growth data have come in above forecasts (index +0.11; over four months 5 releases beat, 5 missed, 2 matched), and inflation data in line with forecasts (index −0.04; 4 hotter, 11 cooler, 8 as expected).
How the index is built
Each release's first print minus the consensus, divided by that indicator's typical surprise, then averaged with a two-month half-life over the past year. Growth: payrolls, retail sales, unemployment (inverted). Inflation: CPI and core CPI, PPI and core PPI, core PCE, hourly earnings. Positive means stronger or hotter than expected.
Under the hood
The pieces of inflation the Fed watches most closely, and the labor-market signals that have flagged past recessions.
Inflation internals
Services ex shelter are steady at 3.3% annualized over three months (3.2% over a year), shelter is steady at 3.2%, core goods are adding to inflation (+2.2%). 53% of the basket by weight is rising faster than 3% a year, against 68% a year ago.
Recession warning lights
Sahm rule
0.00 ptThe three-month average unemployment rate is 0.00 pt above its low of the past year; 0.5 has marked the start of every recession since 1970.
Amber from 0.3, red from 0.5.
Jobless claims
−21%Initial claims over the last four weeks are −21% on a year earlier and continuing claims −13%, no sign of a broad pickup in layoffs.
Amber when initial claims run 10% above a year earlier, red at 20%.
Yield curve, 10y − 3m
78 bpThe 10-year yields 78 bp more than the 3-month bill, a normal, upward-sloping curve.
The New York Fed's recession model uses this spread; red when inverted by more than 25 bp.
Openings per unemployed
1.01There are 1.01 job openings for every unemployed person (August 2026); the quits rate is 1.9%, below its pre-pandemic norm, so workers are staying put.
Amber below 1.0, red below 0.8.
Coming up
Scheduled releases with our call. Times are US Eastern; the consensus fills in a few days before each release.
Where the model stands out
The model's calls for the next releases set against Wall Street's consensus once it is published, or against the last print until then. Gaps are measured in units of the consensus's typical miss.
| Release | Period | Model | Compared with | Gap | |
|---|---|---|---|---|---|
| CPI | Oct 2026 | +0.23% | Last print +0.65% | −5.7× | |
| PPI | Oct 2026 | +0.34% | Last print +1.30% | −3.4× | |
| Core PCE | Sep 2026 | +0.29% | Last print +0.20% | +2.4× | |
| Hourly earnings | Oct 2026 | +0.28% | Last print +0.10% | +2.0× | |
| Core PPI | Oct 2026 | +0.25% | Last print +0.70% | −1.9× | |
| Retail sales | Oct 2026 | +0.25% | Last print +0.80% | −1.7× |
The latest prints
The most recent release of each, against the consensus and the model's pre-release call.
| Release | Period | First print | Consensus | Model | Key Data call | Surprise | Track record since 2023 |
|---|---|---|---|---|---|---|---|
| Consumer Price Index | September 2026 | +0.6% | +0.6% | +0.56% | +0.59% | +0.0 pt | Call ahead |
| Producer Price Index | September 2026 | +1.3% | +0.6% | +0.91% | +0.60% | +0.7 pt | Model ahead |
| Employment Situation | September 2026 | +29k | +89k | +120k | +101k | −60k | Call ahead |
| PCE Price Index | August 2026 | +0.2% | +0.3% | +0.22% | +0.30% | −0.1 pt | Even |
| Retail Sales | September 2026 | +0.8% | +0.3% | +0.21% | +0.30% | +0.5 pt | Even |
| Gross Domestic Product | 2026 Q2 | +1.5% | +2.1% | – | – | −0.6 pt | GDPNow ahead |
How the calls stack up
Average miss against the number first published, every release scored the same way. The Key Data call combines the model with the consensus once the consensus is out and defers to the consensus where the combination has no record of beating it. Best in each row highlighted.
| Release | Releases | Key Data call | Model alone | Wall Street consensus | Other public nowcast | |
|---|---|---|---|---|---|---|
| CPI | 43 | 0.070 | 0.075 | 0.074 | 0.092 | Cleveland Fed |
| Core CPI | 43 | 0.067 | 0.061 | 0.071 | 0.077 | Cleveland Fed |
| PPI | 44 | 0.277 | 0.274 | 0.277 | – | |
| Core PPI | 44 | 0.237 | 0.227 | 0.232 | – | |
| Payrolls | 44 | 67k | 70k | 70k | – | |
| Unemployment rate | 42 | 0.098 | 0.092 | 0.098 | – | |
| Hourly earnings | 44 | 0.086 | 0.090 | 0.086 | – | |
| Core PCE | 43 | 0.037 | 0.059 | 0.037 | 0.083 | Cleveland Fed |
| Retail sales | 45 | 0.318 | 0.359 | 0.318 | – | |
| GDP | 14 | 0.61 | – | 0.71 | 0.61 | Atlanta Fed GDPNow (our GDP call) |
| Release | Releases | Key Data call | Model alone | Wall Street consensus | Other public nowcast | |
|---|---|---|---|---|---|---|
| CPI | 87 | 0.100 | 0.113 | 0.100 | 0.123 | Cleveland Fed |
| Core CPI | 87 | 0.100 | 0.100 | 0.101 | 0.117 | Cleveland Fed |
| PPI | 88 | 0.245 | 0.270 | 0.245 | – | |
| Core PPI | 88 | 0.234 | 0.235 | 0.231 | – | |
| Payrolls | 76 | 87k | 88k | 90k | – | |
| Unemployment rate | 74 | 0.103 | 0.102 | 0.103 | – | |
| Hourly earnings | 76 | 0.107 | 0.105 | 0.107 | – | |
| Core PCE | 75 | 0.044 | 0.060 | 0.044 | 0.081 | Cleveland Fed |
| Retail sales | 77 | 0.378 | 0.454 | 0.378 | – | |
| GDP | 24 | 0.66 | – | 0.76 | 0.66 | Atlanta Fed GDPNow (our GDP call) |
| Release | Releases | Key Data call | Model alone | Wall Street consensus | Other public nowcast | |
|---|---|---|---|---|---|---|
| CPI | 140 | 0.092 | 0.101 | 0.093 | 0.102 | Cleveland Fed |
| Core CPI | 140 | 0.088 | 0.086 | 0.088 | 0.098 | Cleveland Fed |
| PPI | 130 | 0.225 | 0.246 | 0.225 | – | |
| Core PPI | 130 | 0.217 | 0.220 | 0.215 | – | |
| Payrolls | 123 | 73k | 75k | 74k | – | |
| Unemployment rate | 121 | 0.094 | 0.100 | 0.093 | – | |
| Hourly earnings | 123 | 0.102 | 0.104 | 0.102 | – | |
| Core PCE | 128 | 0.041 | 0.055 | 0.041 | 0.069 | Cleveland Fed |
| Retail sales | 130 | 0.332 | 0.415 | 0.332 | – | |
| GDP | 43 | 0.60 | – | 0.60 | 0.60 | Atlanta Fed GDPNow (our GDP call) |
What it means
The read across this week's data, refreshed after each release.
Strong growth, slowing hiring, firmer inflation. The economy is sending mixed signals. Output is growing above trend, with GDP tracking 3.5% for the third quarter, yet payroll gains have slowed to about 50,000 a month. Inflation is moving the wrong way: core CPI is running 3.4% annualized over three months and core PCE is 3.0% over a year.
An energy shock is driving the headlines. Gasoline, diesel and jet fuel prices surged into September, lifting headline CPI (+0.65%), PPI (+1.3%) and retail sales (+0.8%). Pump prices have since leveled off, so the energy boost should fade in October data, leaving core inflation as the signal that matters.
What it means for the Fed. With policy at 3.75–4.00% and core PCE near 3%, real rates are only modestly restrictive. Soft hiring argues for easing; firm core inflation argues against it. The October 29 GDP and PCE release, then November's jobs and CPI reports, will decide which one wins.
This week to watch: GDP and September PCE on Thursday, October 29.
Policy and markets
Where the Fed sits and how markets are pricing it.
At 3.75–4.00% the policy rate is 0.9 pt above core PCE inflation and 66 bp below a simple Taylor rule (4.54%). The 2-year Treasury at 4.69% sits 82 bp above the funds rate, so markets lean toward higher rates over the next two years.