Harvard University economist Martin Feldstein said he’s concerned Federal Reserve policy makers are too complacent about the risks of inflation that’s already quickening toward the central bank’s objective.
“All of the statements that the Fed has been making indicate that they will probably respond too weakly, too slowly,” Feldstein said today on Bloomberg Surveillance with Tom Keene. “We’re already at a point where inflation is close to their target.”
Fed officials have been predicting inflation will accelerate closer to their 2 percent goal, as they scale back a bond-buying program and consider when to raise the main interest rate.
The Fed’s preferred inflation measure, the personal consumption expenditures index, rose 1.6 percent in April from a year earlier, its biggest jump since November 2012.
Feldstein also said as total net worth for U.S. households rises, “that’s bound to show up, and it is showing up, in higher consumer spending.”
The Federal Open Market Committee’s next scheduled meeting is June 17-18.