, Columnist
Is the US Economy in Danger of Reheating?
It’s ironic that a period of slow inflation could bring about faster inflation, but that’s how the logic of expectations works.
High prices could still make a comeback.
Photographer: Mario Tama/Getty Images North AmericaThis article is for subscribers only.
It seems like only yesterday that the inflation debate was all about “Team Permanent” vs. “Team Transitory.” But after several months of low inflation data, a kind of consensus has arisen: Inflation has revealed itself to be transitory.
This is only a temporary (or should I say transitory?) consensus. There are signs that some economies, including that of the US, may experience a phenomenon known as “reheating”: a rapid turnaround that causes inflationary pressures to re-emerge. Is such a phenomenon possible?