The Corner

Economy & Business

The Inflation Scare

Nearly every day, I come across an article saying that high inflation is on the way as a result of loose monetary policy. Here’s today’s installment.

Maybe these worries are right. Some counter-indicators:

The Fed has been below its 2 percent PCE inflation target for almost the entirety of the last dozen years.

Market measures of five-year and ten-year inflation expectations imply continued missing of the target on the downside and are lower than they were at the start of the year.

Commodity prices are down since the start of the year.

Fed-futures markets are projecting low rates through early 2022.

The trade-weighted dollar is roughly where it was at the start of the year.

All of this is more consistent with inflation staying below the target than with its exceeding it, let alone reaching troubling levels.

Ramesh Ponnuru is a senior editor for National Review, a columnist for Bloomberg Opinion, a visiting fellow at the American Enterprise Institute, and a senior fellow at the National Review Institute.


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