The monetary matadors at the Federal Reserve have stared into the eyes of mild price inflation for years. They didn't move a muscle for years and have finally twitched ever so slightly, a couple times in the last few months, with a promise of more.
It is the view of Fed Chair Janet Yellen that signs of overheating in the broader economy are “scarce.” The indispensable Grant's Interest Rate Observer isn't so sure and devoted its front page and then some of its March 10 issue to inflation and how it's measured. After all, the price level is the North Star of central bank policy.
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