Economics
Inflation Index Powell Watches Is Set to Show a Big Jump
- Powell cited gauge in explaining June’s jumbo rate hike
- Fed chief says rise in index ‘needs to be taken seriously’
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A broad index of inflation expectations that Federal Reserve Chair Jerome Powell flagged as being partly behind June’s jumbo interest-rate increase is expected to show a big rise when it’s published later this month, economists said.
Developed by Fed board economists in late 2020, the index of common inflation expectations comprises more than 20 indicators measuring the attitudes of consumers, investors and professional forecasters toward future price increases. Economists at Goldman Sachs Group Inc., Deutsche Bank and Nomura Securities all forecast a big bump in the index when it’s released July 15.