Fed says inflation isn’t transitory? What?!

Sharing is Caring!

Heres some more detail, from the horses mouth:

www.atlantafed.org/news/speeches/2021/10/12/bostic-the-current-inflation-episode

Bostic says the pandemic has turned inflation on its head. The elevated inflation dynamics today are very different from what they were in the months prior to the pandemic.

Bostic says he and the Atlanta Fed believe that “episodic” better describes pandemic-induced price swings than “transitory.” By this, he means these price changes are tied specifically to the presence of the pandemic and will eventually unwind by themselves.

See also  How can we justify a 10-year Treasury yield of 1.5% with inflation running well over 5%?

He points out, though, that it is becoming increasingly clear that the intense and widespread supply chain disruptions that have animated price pressures will not be brief.

See also  Inflation Explodes Higher!! Biggest Number Since 1991.Supply Chain Bottlenecks Exploding...Expect Shortages Of Everything

Bostic believes the real danger is that the longer the supply bottlenecks and attendant price pressures last, the more likely they will shape the expectations of consumers and businesspeople, shifting their views on pricing and wages in particular.

h/t  wtt90

314 views

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.