Fed eyes inflation expectations

The American Federal Reserve is “very, very focused” on inflation expectations, a top Fed official said yesterday. While Dennis Lockhart expects only a “moderate pace of inflation” in the US, policymakers will keep a close eye on potentially self-fulfilling consumer expectations for higher prices, he said. However, Lockhart expects consumer spending to remain subdued. “A less consumption-dependent economy will help rebalance the country's external accounts,” Lockhart added.