Increases in energy and transportation costs that were magnified by comparisons to last year’s economic downturn helped push the Consumer Price Index higher at an annual rate of 2.6% in March, according to government data released on Tuesday. The increase in the CPI, which was 0.6% on a monthly basis, ... READ MORE >
Search Results for: inflation
CHART OF THE DAY: Deflating the hype on inflation
As the economy continues to recover and is poised for a period of robust expansion, the conversation continues to shift toward the outlook for inflation. While we expect the year-ago effects brought on by the global pandemic to result in a period of moderate reflation in the economy, the longer-term ... READ MORE >
CHART OF THE DAY: Where in the world is wage push inflation?
Much of the talk about risks to the economic outlook has been linked to the prospect of higher inflation following more than $5 trillion in federal spending to address the pandemic. But what is often missing in that discussion is the link between price volatility and wages. It is difficult to make ... READ MORE >
Making sense of inflation: What we can learn from post-recession recoveries
It's a central tenet of economics: We should expect prices to increase when the demand for goods and services increases, and to decline when demand diminishes. Price rigidity and the presence of product choices will dictate the speed at which price changes occur. This has held up in our analysis of the ... READ MORE >
U.S. February Consumer Price Index: Inflation to rise from a low base
Much of the recent discussion around risks to the domestic economic outlook revolves around inflation or the ghost of something that has not materially haunted the American economy during the past four decades. While year-ago base effects will cause top-line estimates of pricing to rise in the coming ... READ MORE >
CHART OF THE DAY: Amid talk about inflation, expectations have remained in check
The yield on 10-year Treasury bonds had been slowly rising by roughly 9 basis points per month since last summer as the prospects for a vaccine and the economy improved. But since the end of January, there has been a jump of 50 basis points, with 10-year yields twice breaching 1.5% and then 1.6% in the ... READ MORE >
Powell statement: Market challenging Fed’s credibility on inflation targeting
The knee-jerk market response that sent the 10-year Treasury yield to 1.54% during Thursday’s speech by Federal Reserve Chairman Jerome Powell implies that the Fed may have to act to dampen yields at the long end of the curve. That may be necessary to reinforce its policy regime of flexible average ... READ MORE >
U.S. inflation outlook: Don’t believe the hype
The reflation of the American economy following the debilitating effects of the pandemic has begun. Recent increases in growth forecasts, the January jump in retail sales, trillions of dollars in fiscal aid and stimulus, as well as the prospect of a household-led boom over the next two years, have ... READ MORE >
Inflation-adjusted interest rates and investment in the future of Canada’s economy
A confluence of events and policy shifts has coalesced into a unique opportunity for the Canadian government and firms to make long-term strategic investments. The arrival of inflation-adjusted negative interest rates presents a rare chance for Canadian businesses to invest in their firms and ... READ MORE >
FOMC preview: Addressing market rise in inflation expectations
The January meeting of the Federal Open Market Committee this week presents the central bank with an opportunity to reinforce its forward guidance, which is most likely not going to change for years. At the same time, it will provide Federal Reserve Chairman Jerome Powell the opportunity to damp down ... READ MORE >