Federal Reserve Economic Data

The harmonized index of consumer prices (HICP) is a measure of inflation published by Eurostat that’s comparable across all countries in the European Union. It covers all 12 categories of the “European classification of individual consumption according to purpose” (ECOICOP).

FRED has all these data, and the FRED graph above shows some:

• the harmonized index of consumer prices for coffee, tea, and cocoa in the euro area (in red)
• the IMF global prices for coffee (in purple), tea (in green), and cocoa (in orange)

We customized the data to create an index with a value of 100 in the year 2000, when the first HICP data are available, to better compare the changes in commodity prices to the change in the harmonized consumer price index.

So, what’s brewing? Global prices for cocoa and coffee have almost tripled between 2000 and the time of this writing. During that time, the global price for tea has increased at a much lower rate, about 10%. As might be expected, the harmonized consumer price index tracking those categories has also increased. However, that growth was merely 50% because the harmonized consumer price index for the whole of the euro area is an aggregate of the harmonized consumer price index for each of its 19 member countries. As it happens, different countries prefer different comfort drinks.

According to the detailed 2023 HICP data published by Eurostat:

• In Ireland, tea and coffee prices have very similar weights in the calculation of the HICP. So there, the price index of comfort drinks tracks close to the cost of brewing a cuppa.
• In Austria, coffee prices have five times the weight of tea prices in the calculation of the HICP. So there, the price index of comfort drinks tracks close to the cost of brewing a cup of joe.
• In Spain, cocoa and powdered chocolate prices have relatively larger weights in the calculation of the HICP than in Ireland and Austria. So there, the price index of comfort drinks tracks close to the cost of anything chocolate.

How this graph was created: In FRED, search for and select “Harmonized Index of Consumer Prices: Coffee, Tea, and Cocoa for Euro area (19 countries).” Next, click on the “Edit Graph” button and use the “Add Line” tab to search for and add “Global price of Tea, Kenyan.” Repeat the previous step to add “Global price of Cocoa” and “Global price of Coffee, Robustas.” Next, click on the “Edit Line 2” tab and change the units to “Index (scale value to 100 for chosen date)” with 2000-01-01 as the index date.

Suggested by Diego Mendez-Carbajo.

When unionized workers go on strike, the total amount of hours worked in the economy decreases; but the level of employment reported each month in the Current Employment Statistics survey may not show a similar change. The impact of labor stoppages on the number of people on payrolls depends on the timing and duration of those collective bargaining actions.

The FRED graph above shows the employment level in the motor vehicles and parts industry reported by the Bureau of Labor Statistics between January 1990, the earliest available data, and the time of this writing. Two major labor stoppages stand out: the lockdown caused by the COVID-19 pandemic in April 2020 and the 54-day strike by the United Auto Workers (UAW) union against General Motors in July 1998.

The Bureau of Labor Statistics publishes a monthly strike report of labor stoppages of 1,000 workers or more who were idle during a complete pay period while the Current Employment Statistics survey was conducted. Depending on the industry, the pay period may be weekly, biweekly, monthly, or semimonthly. The reference date for conducting the CES survey is the 12th day of the month.

To learn more about this topic, read “Understanding strikes in CES estimates” by John P. Mullins in the Monthly Labor Review. You can check the industry data referenced in Figure 1 of that publication in this FRED graph. For more information on current UAW contract negotiations, look to the Chicago Fed.

Other large-scale labor actions, such as the August 1983 telecommunication workers strike against AT&T, are also visible in FRED. However, the ongoing Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) strike against the Alliance of Motion Picture and Television Producers is not immediately noticeable in the recent overall employment figures for that industry. That may well be a case where the full story is truly behind the numbers and a data graph is unable to tell it.

How this graph was created: From FRED’s main page, search for and select “All Employees, Motor Vehicles and Parts.”

Suggested by Diego Mendez-Carbajo.

The FRED graph above shows the exchange rate of two currencies with the US dollar: the Swiss franc and the Colombian peso. We chose these two for their obvious contrasting history.

• The Swiss franc is considered to be among the strongest currencies—meaning that it tends to appreciate with respect to many other currencies.
• The Colombian peso is the opposite, with continuing depreciation with respect to strong currencies. (One peculiar benefit of using this currency is that it was never rebased—i.e., never had a few zeroes removed from its high face value. This numeric consistency avoids potential issues with displaying the peso’s exchange rate across various definitions of the currency.)

The graph shows that, over the longer run, the Swiss franc has become stronger than the dollar while the Colombian peso has gotten significantly weaker than the dollar. There are considerable variations at shorter horizons, which can be driven by many factors related to the expectations about the currencies’ respective economies. (This recent FRED Blog post covers this topic.) But back to the long-run changes…

The second graph takes the same exchange rates and adjusts them by the inflation rates in the US, Switzerland, and Colombia. These are so-called real exchange rates. Note how the lines are much flatter, especially as you compare the scale of the vertical axes in both graphs.

A large part of these long-run exchange rate movements can indeed be explained by inflation differentials: Inflation is typically low in Switzerland, while it is typically high in Colombia. The lines are not completely flat, though. First, the consumer price index or the GDP deflator may not be the appropriate price index to use here, as other factors such as taxes, tariffs, and other trade impediments may matter. Finally, most currency exchange is not performed to buy foreign goods, but rather for purely financial transactions. Thus, a currency can be more or less attractive depending on economic or political developments.

How these graphs were created: Search FRED for “Colombia exchange rate” and take the option with the longest time range. Click on “Edit Graph,” open the “Add Line” tab, and search similarly for “Switzerland exchange rate.” Open the “Format” tab and put the legend for the second line on the right. You have the first graph. For the second, take the first graph, click on “Edit Graph,” add series by searching for “US CPI,” then again for “Colombia CPI,” in both cases making sure the series is as long as possible and in levels, not growth rates. Apply formula a*b/c. Repeat for the second line and “Switzerland deflator” (the CPI series is too short).

Suggested by Christian Zimmermann.