The central bank expects to maintain ultralow rates until “inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time.”
Economists expect the rise in prices to continue into the summer, pushing inflation past the Federal Reserve’s 2% target.
An AICPA survey finds "a resurgent sense of optimism about the economy overall, despite the deep pain that remains in key sectors and industries."
“Overall, compensation costs are likely to remain subdued going forward, reflective of a high level of unemployment that will restrain wages."
“With the explosion in virus numbers putting downward pressure on demand in the short-term, we expect inflation to remain subdued for a while yet."
Core inflation rose 0.6% last month, the largest gain since January 1991, as the disinflationary impact of the coronavirus continued to wear off.
The coronavirus crisis drove consumer prices into "a disinflationary shock" last month despite government efforts to stimulate the economy.
The March decline in spending "is the tip of the iceberg. The worst is yet to come with the April data.”
“Deflation is likely to take hold over the next few months as businesses slash prices in response to much lower demand from the coronavirus outbreak."
"The disinflationary impact from the [coronavirus] and the crash in oil prices will exert even more downward pressure on prices."
After the third-quarter contraction, “There is hope that the recent slight productivity uptick may lead to better results in the future."
“Consumers shielded the economy from global headwinds for most of 2019 but they won’t prove immune to the coronavirus outbreak."
