Evans of the Fed says rising inflation is “temporary” but sees bullish risk

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The president of the Federal Reserve of Chicago, Charles Evans, repeated on Monday (8) his view that the current increase in inflation it is largely “temporary” and will disappear as supply-side pressures are resolved, but he also sounded less convinced about this assumption than before.

“I expected to see more progress so far,” Evans said in prepared comments to the Original Equipment Suppliers Association, adding that there are signs that inflationary pressures may be growing more broadly, including increases in rents.

“These developments deserve careful monitoring and pose a greater upside risk to my inflation outlook than I imagined last (Northern Hemisphere) summer.”

It is notable that Evans, one of the more ‘dovish’ (prone to more expansionary monetary conditions) members of the Fed, is articulating a growing concern about inflation, but perhaps not too surprising given that price-raising measures have been in the works for months. way above the target of 2% of the Fed.

Economists expect the October reading of the consumer price index, which will be released this week, to show an increase of 5.8% from the same period last year.

But Evans also noted that inflation expectations based on surveys and prices in the financial market they also suggest that the above-than-usual inflation on Monday is temporary.

Reference: CNN Brasil

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