In response to a post earlier this week on M2 and inflation, one of our readers asks why I looked at M2 rather than M3. Here’s the answer.
Category Archives: inflation
M2 and inflation
High commodity prices and indications of rising inflation have renewed interest in the hypothesis that the U.S. has been increasing the money supply in recent years at an excessive rate.
Stagflation
We all understand that the Fed’s next move depends on incoming data. But what if the incoming data raise concerns of both higher inflation and slower output growth?
Commodity price inflation
Commodity markets have been a little too exciting recently for my quiet tastes.
What’s moving long-term yields?
Long-term interest rates continue to creep up.
Inflation concerns
The Bureau of Labor Statistics reported that inflation as measured by the seasonally adjusted consumer price index for all urban consumers rose only 0.1% in February (a 1.2% annual rate), down from 0.7% (an 8.4% annual rate) in January. Those who view the monthly CPI as the most important inflation indicator breathed a sigh of relief, perceiving the economy to have lurched from hyperinflation back to price stability within the space of 30 days.
Rising long-term yields
The yield on 10-year U.S. Treasuries is up almost 40 basis points so far this year, which means it’s been gaining on the fed funds rate and reducing the prospect of full inversion of the yield curve. Why have rates been going up?
Gold and inflation
What’s behind the ongoing run-up in gold prices? One popular interpretation is that investors fear a resurgence of U.S. inflation. But that story just doesn’t square with the facts.
Inflation under control
Unlike September’s troubling inflation statistics, yesterday’s release by the Bureau of Labor Statistics of the October consumer price index is more reassuring.
Inflation’s back?
Does today’s CPI release indicate that inflation has returned?