SBE Council Economist on Latest Inflation Numbers

Raymond J. Keating, chief economist for the Small Business & Entrepreneurship Council (SBE Council), offered the following statement in reaction to the CPI inflation numbers released this morning by the U.S. Bureau of Labor Statistics:

"Inflation heated up again over the past three months. No one should be surprised.

"CPI increased at 0.2% in January, 0.4% in February, and 0.3% in March. At an annualized rate then, inflation over the past three months registered 3.6%. Keep in mind that, but for a three-month break, CPI inflation has been running hot since December 2010.

"That's not surprising because the Federal Reserve opened the monetary floodgates in late summer 2008, only taking very minor breathers along the way, and in the end, inflation always is a monetary phenomenon.

"Looking ahead, any further improvement in the economy could work to further unleash the inflation rooted in loose Fed policy. None of this, though, is necessary. Instead, it's merely bad policymaking. If the Federal Reserve would simply get refocused on price stability, then we would experience benefits in terms of certainty, growth and inflation."