Lyle Gramley Inflation Quotations

I don't know what the bond market has been worried about. There's much talk about the possibility of inflation beginning to pick up. I don't see any signs of that at all apart from the rise in energy prices, which we all knew was going to take place.

I can't interpret this report as a weak economy, and I don't think the Fed will either. They are going to persist in moving interest rates up until they see greater indications than what we have now that either the economy is weakening, or inflation is getting under control, or both.

Greenspan is not a guy likely to brag much, but he'll indicate the economy is still in good condition, that much of the recent bubbling up in inflation is likely to prove transitory, and that fundamentals of the economy are still quite strong despite some of the recent data.

The apparent bubbling up of inflation we saw earlier in the year has quieted down again. Basically it's a picture of inflation staying reasonably tranquil. The Fed should like that.

This time, we're starting with an inflation rate that's too low and heading lower, ... What that means is the Fed will sit still until such time as it sees inflation start turning up -- which might not happen until late 2004 or early 2005.

The bottom line is that their principal concern is that inflation might go lower, so we'll get the same kind of statement we got last time.

The Fed will be content to sit on the sidelines to await more definitive evidence as to whether inflation is going to be a problem or not, ... Setting the election aside entirely, the Fed, looking at the incoming data, would say to itself 'right now we don't want to raise interest rates and we don't need to raise interest rates.'