Inflation Expectations Archive

FOMC

Karim Basta: Further cut to gwth outlook Financial conditions tighter and housing getting worse Inflation receives greater concern than prior statement Conclusion: downside risks predominant and ‘timely’ means another intermeeting cut on the table. Agreed, further comments below: Release Date: March 18, 2008 For immediate release The Federal Open Market Committee decided ...Read More

Mishkin speech

Not a quick read, but telling – inflation risks seem to be overtaking concerns with the economy: Does Stabilizing Inflation Contribute to Stabilizing Economic Activity? (Interesting that this is a question) The ultimate purpose of a central bank should be to promote the public good through policies that foster economic prosperity. Research ...Read More

Bloomberg: Trichet may not cut rates in 2008

Trichet May Not Cut Rates in 2008, Say Merrill, ABN by Simon Kennedy (SNIP) (Bloomberg)Erik Nielsen, Goldman Sachs’s chief European economist, disagrees. He said the ECB’s primary mandate is to preserve price stability, so it has no room to follow the Federal Reserve and the Bank of England, even as economic growth ...Read More

Mishkin’s speech

From today’s speech: A central bank must always be concerned with inflation as well as growth. As I have emphasized in an earlier speech about inflation dynamics, the behavior of inflation is significantly influenced by the public’s expectations about where inflation is likely to head in the long run (Mishkin, 2007a). Therefore, ...Read More

Another Yellen speech

Prospects for the U.S. Economy in 2008 (intro remarks snipped) Today I’d like to talk about developments in the economy and in monetary policy, two items that have definitely been making the news lately. On January 22, the Federal Open Market Committee cut its main policy rate—the federal funds rate—by three-quarters of ...Read More

Yellen on inflation

SF Fed president Yellen on inflation, from yesterday’s speech in Hawaii: Now let me turn to inflation. The recent news has been disappointing. Over the past three months, the personal consumption expenditures price index excluding food and energy, or the core PCE price index—one of the key measures included in the FOMC’s ...Read More

Claims, ECI

From Karim: True to the past 5yrs pattern, claims seem to be reverting to trend after the first few weeks of January. Right, good call! IJC climbed from 306k to 375k; the trend before the January drop was around 340-350k; this number was for MLK holiday week, so an adjustment issue here ...Read More

Inflation expectations update

As of 1pm today – this is what the Fed is looking at for today’s meeting. Most say if you let expectations elevate it’s too late. Others think they can be allowed to elevate a little bit and then brought down. ♥ ...Read More

Fed’s pet inflation expectations indicator

If the Fed doesn’t care about this they REALLY don’t care about inflation? 5Y5Y Break-even Inflation since 2006 ♥ ...Read More

Why I expect US exports to continue to be very strong..

The desire to accumulate $US financial assets has been diminished for at least the following reasons: Treasury policy – Paulson is actively pushing both a strong yuan and threatening any other CB that buys $US with the label of ‘currency manipulator.’ CB’s had been perhaps the largest source of $US financial assets ...Read More