After two worrisome months, we are finally getting some better news on the inflation front. The Personal Consumption Expenditures Price Index (PCEPI) grew at a continuously compounded annual rate of […]
Tag: Inflation
Have We Crested the Inflation Wave?
Finally, some welcome news on the inflation front: Core PCEPI inflation is down to 4.6 percent year-over-year, and 0.3 percent month-over-month, which is 3.6 percent annualized. PCEPI growth has fallen […]
Fed Raises Rate, But Signals Potential Pause in May
The Federal Open Market Committee (FOMC) moved forward with an anticipated 25-basis-point increase in its federal funds rate target on Wednesday. It no longer, however, “anticipates that ongoing increases in […]
Money and Inflation Are Still Related
“There is perhaps no empirical regularity among economic phenomena that is based on so much evidence, for so wide a range of circumstances,” Milton Friedman observed in 1989, “as the […]
Monetary Policy and that Old-Time Fiscal Religion
The ongoing debt-ceiling debate has brought concerns about the sustainability of US fiscal policy to the forefront of public discussion once again. While it may be tempting to blame current […]
Moral hazard is a fact of life. The Fed should focus on inflation.
February’s inflation data were an unwelcome surprise. The Consumer Price Index (CPI) grew at a continuously compounding annualized rate of 4.4 percent on the month. Core CPI, which excludes volatile […]
Understanding Inflationary Finance
Despite common assertions to the contrary, government spending does not necessarily cause inflation. Whether it does so depends on the willingness of the monetary authority to help finance the government […]
There’s No Such Thing as a Wage-Price Spiral
Hotter-than-expected inflation has rekindled fears about a wage-price spiral. Writing in the Wall Street Journal, Jason Furman argues the Fed should tighten even faster. The economy’s “underlying inflation” is due […]
The Fed Isn’t Powerless
In a recent article at Axios, Neil Irwin asks why interest rate increases haven’t tamed inflation. Inflation remains high despite eight rate-hikes by the Fed over the past year. The […]
Persistently Pesky Price Pressures
Inflation remains stubbornly high. The Personal Consumption Expenditures Price Index (PCEPI), which is the Fed’s preferred measure of inflation, increased 0.6 percent in January, higher than most analysts had expected. […]