U.S. headline CPI inflation has had an impressive surge and an equally impressive reversal. Are Americans heading back to the good old days of persistent low inflation? Unpacking the trends in CPI and their causes suggests not, with important implications for all of us in the real economy.
The rapid decline in headline inflation is occurring primarily due to the causes of the price surge being removed. Or, as Will Rogers famously observed: “if you want to get out of a hole, stop digging”. When the COVID pandemic hit, 22…
Read the full article here