I haven’t been paying as much attention as usual to inflation indicators. But we’ve been getting a string of good news.
One source of inflation pessimism was the high ratio of job openings to unemployed workers. That issue has now gone away, with unemployment still very low 1/
Underlying inflation is also low. I like the New York Fed’s measure, in large part because it’s an algorithm that doesn’t involve judgement calls and hence possible motivated reasoning. It’s within spitting distance of the 2 percent target 2/
Finally, for those concerned inflation might get entrenched in expectations, the Atlanta Fed’s measure of business expectations is also within spitting distance of 2 percent. Hard to see anything here that justifies concerns about “sticky” inflation or a difficult “last mile” 3/
At this point the question is not the last mile, but the last inch. Are they going to create a recession to get that last inch, especially since we're probably better off settling at least an inch higher.
That’s not how unemployment is calculated. Many people can’t claim unemployment. “The BLS derives its unemployment data from the Census Bureau's Current Population Survey, which interviews about 60,000 people each month.”
