Pandemic Ebbs and Flows: Economic Data, Inflation Concerns, and Policymaking

Speech from Federal Reserve Bank of Boston

Abstract: With a shock as large as the pandemic, policymakers need to be alert to potential changes to the economy. To date, inflation expectations and the underlying inflation rate look to be stable. It is important to keep in mind the difficulty that was experienced in achieving inflation of 2 percent in the United States and most of the developed world after the Great Financial Crisis. As a result, my perspective is that the emphasis on actual outcomes rather than forecasts of rising inflationary pressures when setting monetary policy appears justified. However, given the noise in the data, it will be important to carefully filter underlying inflation trends as labor markets tighten.

Keywords: economic outlook; COVID-19; inflation; monetary policy; fiscal policy; labor markets; inflationary trends (search for similar items in EconPapers)
Pages: 12
Date: 2021-05-14
New Economics Papers: this item is included in nep-mac and nep-mon
Note: Eric Rosengren’s comments were delivered as part of the Maine Bankers Association Directors’ Forum, and were based on a speech he delivered on May 5, 2021.
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Related works:
Working Paper: Pandemic Ebbs and Flows: Economic Data, Inflation Concerns, and Policymaking (2021)
Working Paper: Pandemic Ebbs and Flows: Economic Data, Inflation Concerns, and Policymaking (2021)
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