Several authors have documented a reduced variability ofoutput and inflation in the United States since the beginningof … standarddeviation of quarterly output growth has fallen 30 percent,while the standard deviation of inflation has decreased morethan 40 … percent. These changes in the time series properties ofoutput and inflation raise a number of important questions …

[...]In this article, we model the relationship between goodsinflation and services inflation from 1967:2 to 2002:4. To … helpinform the inflation debate, we then use our results to forecastinflation for 2003. The specific inflation series that we … services inflation have experiencedpermanent increases and reductions, but these shifts havemoved roughly in tandem.2 That is …