U.S. FIG Dropping Faster

U.S. inflation pressures fell in September to a more than six-year low indicating policy makers should focus on economic growth, a research group said on Friday.

The Economic Cycle Research Institute's U.S. Future Inflation Gauge (USFIG), designed to anticipate cyclical swings in the rate of inflation, slipped to 103.7 in September from 107.3 in August, revised from 109.3.

The reading was the lowest since May 2002, when the index stood at 102.1.

"With the USFIG diving to a new 76-month low, underlying inflationary pressures are clearly in rapid retreat," said Lakshman Achuthan, managing director at ECRI, in an instant message interview.

"The (index's) well established downturn strongly counters any inflation fears that may still be concerning Fed officials."...

The USFIG annualized growth rate, which smooths out monthly fluctuations, fell in September to minus 17.8 percent from minus 13.9 percent in August, revised down from negative 11.0 percent.