PriceStats®: Inflation Indicators
A look at quarterly measures of inflation, based on prices of millions of items sold by online retailers, to help investors anticipate and evaluate the impact of inflation.
Inflation Ends the Year on a High Note
Hopes that inflation normalcy was returning to the markets has taken a backseat as of late, with the Fed and other central banks signalling firmer prices across much of the developed markets. And while December often offers a period of respite for inflation hawks, our PriceStats readings of online inflation levels shows stronger than average prices at the end of the year. This should not create outright panic, as many of these monthly inflation readings are still in the single digits, although relative to the outright deflation that often accompanies December holiday discounting, these variations from historic pattern are worth watching.
For instance, in the U.S., PriceStats is showing 9 bps of monthly gains in December, not overly troubling, although is not as positive when compared to the typical 5 bps of decline we see during the month. This increase and less favourable base effects means that we are starting 2025 with online U.S. inflation above 2% for the first time since August. The data from the Eurozone is a bit less soothing, with monthly readings for the EZ in excess of +30 bps. This will pull its annual reading above 2% for the first time in the quarter, with prices seeming to trough in October. The BoE is in a similar quandary, with monthly readings of +32 bps, raising its annual inflation readings back above 3% for the first time since late summer. Continuation of these patterns may require many central banks to reconsider the rate cut plans that are still the base case of much of the developed markets.
US Sector Inflation Data Near Averages
Upon closer inspection, while overall U.S. inflation data is closing out 2024 slightly higher than season averages, details at the sector level are mostly close to 10-year averages. We know that aggressive Black Friday sales may have positively impacted December prices, making them look slightly higher than recent trends. Having said that, of the major categories that we track, only clothing is above 10-year averages, while both food and health and beauty prices are below seasonal levels. Even electronics, which may have had the most aggressive Black Friday discounting, saw price increases that were essentially what we would expect at this time in the year. All of this will likely encourage the Fed, which continues to state that its 2% goal is still within reach, even if incoming tariff policies may extend the timeline before we get to target.
Figure 2: December Inflation Versus Seasonal Averages

Japan Inflation Continues to Rise
Inflation in Japan has been on an upward trend for the better part of 2024, making it one of the few countries that has not experienced a temporary respite from rising prices. And while this strengthens the case for the BOJ to more aggressively raise rates, the central bank continues to signal unwavering patience in its normalization process. Our PriceStats reading of annual inflation is closing out 2024 at over 3%, its highest reading since we started tracking online Japanese prices in 2012. With our inflation reading rising 90 bps over the quarter, we still expect the rate hikes to come from the BOJ, even as their official communications remain generally non-committal to the prospect of higher yields. With official inflation data diverging from online readings recently, a recoupling with our data may force the BOJ’s hand sooner rather than later.