The latest data, and still-accommodative financial conditions, suggest the Fed does not have to cut rates aggressively.
Practically speaking, no one should expect any ECB tightening at all until some time in 2022.
Without a forecast, the Bank of England is without a clue about whether there will be inflation on March 29, or thereafter.
The ECB’s plan for ending asset purchases hinges on a questionable CPI forecast.
Could a sales tax hike in October 2019 help the BoJ finally reach its inflation goal?
How much do changes in oil prices and exchange rates affect inflation? Not much.
Our bet is that the ECB will maintain accommodative monetary conditions into 2019 at least.
The CPI rises every time there is inflation and falls when there is deflation, but every change in the CPI is not due to inflation or deflation.