Federal Reserve's Mester: CPI Data Gives No Reason for Smaller Hike

The video discusses the appropriate path of policy, focusing on inflation trends and market expectations. It highlights the lack of convincing evidence that inflation has turned a corner, despite falling energy prices. The discussion includes the need for deliberate action on interest rates, considering inflation expectations and the neutral rate. Future rate decisions will depend on demand and supply balance, with no current indication of easing price pressures.

What factors are being considered in determining the appropriate path of policy?

What evidence is mentioned regarding inflation and its current status?

How do energy prices relate to the expectations of future inflation reports?

What is the significance of the 2 1/2 percent long run neutral rate mentioned?

What are the implications of the inflation report on future rate increases?