Sometimes, large entities have enough money to throw at a problem that by sheer magnitude they produce something great (albeit at too high a cost). The iPhone app from the FRED is not that thing. But the Excel add-in is something that every macroeconomics professor should consider adding to their toolkit.
Personally, I include links to FRED content in the lecture notes that I provide to students. But FRED makes it easy to do so much more. They now have an add-in that makes accessing data *much* faster. With it, professors can demonstrate in excel their transformations that students can easily replicate. The advantage is that students can learn to access and transform their own data rather than relying on links that I provide them.
The tool is easy enough to find – FRED wants you to use it. After that, the installation is largely automatic.
Installed in excel you will see the below new ribbon option. It’s very user friendly.
Given that it’s your first time using the add-in, you can just click on ‘Quick Start’. It gives you the basic overview. In any column you can type the first 4 rows of the data that you desire:
- The series code.
- The Transformation
- The Frequency
- The Start Date
Obtaining simple level data is easy, but learning to transform the data takes only a small amount of experience. Say that I want the US CPI for all items, CPI for urban consumers, PCE price index, and the GDP implicit price deflator expressed as a compound annual rate of change. Also say that I want the data to be quarterly and starting in January of 2002. If I am inexperienced, then I can ‘search’ the data, which will navigate me directly to the FRED website in order to find the data codes. If I am moderately experienced, then with a cell in the first row selected I can use the ‘Data Releases’ option to search in the organization tree to find my data. Experts who already know their data series code can simply type it in the first row.
I can also select ‘Data Manipulations’ to see the various transformations that FRED offers. Once I have them, I can simply enter the below into excel and then select ‘Get Data’. The result is almost exactly what I wanted.
The only thing that I don’t like about the below is that the multiple columns for date are redundant. But that’s an easy fix. Otherwise, the output is entirely appropriate. In fact, the results are very useful if I specified a variety of data frequencies. To boot, some cells are populated with the title of the series and transformation (avoiding mistakes) and the source (making citation easier).
I L-O-V-E this add in. I can download several data series quickly and have them all start at the same date faster than if I download them ‘manually’ from the FRED website. Then I can spend more of my time on analysis rather than data acquisition.
Personally, I wanted to know whether these 4 measures of price increase in spread with the average rate of inflation. According to the below graph, they do. But, it seems more like they diverge when there is a deviation from ‘typical’ rates of inflation. Using the FRED add-in means that I spend less time acquiring and organizing data, and more time doing the analysis.
As I mentioned, I prefer that the dates be consolidated into one column when the frequencies match. Another limitation worth noting is that the data transformations are limited too. I wish that I could use the Add-in to calculate RGDP per capita. However, using the add-in to retrieve RGDP and population values and then calculating the ratio in excel is NBD.
If you want to quickly access macroeconomic data, then this add-in is for you.