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Inflation Is About To Spike Due To The "Base Effect"

This past May we explained that one of the officially stated reasons why the Fed had delayed hiking rates (a situation that remains unchanged some 5 months later) is because CPI inflation in late 2015 and early 2016 had been lower than the Fed's bogey. And, based at least on the CPI's basket weighing of headline input prices, the Fed may have been right: the main reason for this is that tumbling energy prices kept gas prices at the pump in check, which because it is one of the primary drivers of Headline CPI, kept inflation subdued.
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