Summary

  • Fed researchers said a sharp oil price spike could push up core inflation more than it did before the Covid-19 pandemic.
  • The researchers said an oil price shock could also affect core inflation excluding energy prices, and that the duration of inflationary pressure may be longer.
  • The study said the impact of rising oil prices on core inflation may have increased compared with the past.

Forecast Trend Report by Period

A surge in global oil prices could push core inflation higher than it did before the Covid-19 pandemic, with the impact also lasting longer, according to an analysis by Federal Reserve researchers.

Cointelegraph reported on November 9 that the researchers found oil price shocks may generate stronger inflationary pressure and prolong it compared with the pre-pandemic period.

The researchers said sharp moves in global crude prices can also affect core prices excluding energy.

The findings suggest the effect of rising oil prices on core inflation may have increased compared with the past.

JH Kim