Thursday, June 21, 2012

Inflation not affected by easing

During Bernanke's comments, I managed to screen snag one of his images--that of anticipated future inflation.


Here we see that inflation increased through 2011, a period characterized by QE2 until June and operation Twist thereafter (both forms of easing). Further easing, however, will result in inflation falling back to the Fed's 2% target level.

It must be nice to live in a fantasy world.

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