The US Bureau of Labour Statistics released the latest CPI data for January today.
The overall CPI came in slightly higher than expected. However, most the increased contribution came from abnormally large increases in the indexes for medical care and food. With analysts reckoning these to be of lesser importance (for the Fed), markets seemed to shrug off the higher headline number.
An interesting observation comes in a footnote in the BLS press release
“Effective with this release, index levels are now published to three decimal places. Percent changes based on these three-decimal place indexes will continue to be published to one decimal place.”
So, the Americans are going to make their data more precise!
While this removes the problem of rounding off errors, how accurate will the data become - only time will tell.
There is no doubt that economic data coming out of the US is of a far higher quality - the move to make it more precise will only improve it further - than, say, India, China or Russia. Coming to think of it, these are the very countries many expect to stand tall in the coming global economic order.
It’s, probably, high time that these (and other) countries start paying attention to the quality and reliability of their economic data. Hopefully, the American move to set their own bar higher would act as a catalyst (or should I say wake up call) for others.