BIS Review 1/2004  3  expectations are critical to maintaining economic stability in the short run. Price stability is of utmost importance to the nation’s economic health, and I believe that the FOMC will do whatever is necessary to be sure that inflation remains well contained.
With that preface, I will address briefly a few concerns of those who worry that inflation is poised to rise, beginning with the recent behavior of commodity prices. A number of commodity price indexes have indeed risen sharply over the past couple of years, including a large jump in the past several months.