The rises would be temporary so long as inflation did not persistently deviate from its long-term price-stability target. But even in this preferred approach, the widely watched nominal federal funds rate would likely rise for a time. Current events With that backdrop, I will now turn to the current situation.
As shown in figure 2, the spot price of oil (solid line) has recently spiked up, as it has several times since 1985.5 But in contrast to most other oil-price-spike episodes, this time the far futures price of oil - that is, the price for contracts seven years out - has also risen sharply.