Charles L. Evans, executive director of the Federal Reserve Bank of Chicago, made a statement this Monday and has repeated its view that the current rise in inflation is largely “temporary” and will fade as supply-side pressures are resolved, but also he sounded less convinced on this topic than before.
“I was hoping to see more progress by now,” Evans said in remarks prepared for comment at an Original Equipment Suppliers Association event, adding that there are signs that inflationary pressures may be mounting widely, including rent increases.
“These events deserve careful monitoring and pose a greater upside risk to my inflation outlook than I had thought last summer.”
Key comments from Evans
There is still a way to go to inclusive full employment.
The economy is still closely linked to the virus, the way forward is highly uncertain.
With cases on the downside, there is room for optimism.
Just because of the unemployment rate, full employment would be very close, but this data does not tell the whole story.
Stronger labor market conditions will bring some early retirees back to work.
Much of the current rise in inflation is temporary.
It is highly uncertain how long it will take for supply and demand conditions to normalize and reduce inflation.
I see one higher upside risk to the inflation outlook than I had seen last summer.
The Uncertainties about the outlook could lead the Fed to raise or delay rate hikes.
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