From CNNMoney, courtesy of my colleague Emre Ergungor:
| 1. Will Katrina help send the U.S. into a period of higher inflation? |
Yes 75%
No 25%
Of course, this is not much of a shock. I suspect almost everyone believes that some near-term price pressures were developing as a consequence of energy market developments, even before Katrina. It is undeniably reflected in the latest Wall Street Journal survey of economists:
Forecasts for inflation were lifted sharply amid the dramatic increase in gasoline and other energy prices. The economists now see the Labor Department's consumer-price index increasing 3.3% year over year in November, up from an expected 2.8% annual increase that was forecast in last month's survey, and they think the CPI will increase 2.8% in May 2006, up from the 2.5% forecast increase last month. The CPI rose 3.2% in July.
Not great, but the important thing for monetary policy is longer-term inflation expectations. For that reason, I will be keeping my eye on this picture:
Theses series do not capture the events of the last several weeks fully, or equally well. Although the household expectations series -- from the University of Michigan survey -- is current as of August 26, the latest SPF (Survey of Professional Forecasters) data is actually from the second quarter, and the adjusted TIPs measure -- explained here -- is a monthly average. So things could change, for sure. But so far, so good.