This is a measure of inflation that is based on the rate of increase in the prices of all goods and services, including those related to food and energy. That rate currently stands at 1.6 percent, which is below the FOMC’s target of 2 percent.
In fact, the inflation rate has averaged 1.6 percent since the start of the recession six and a half years ago, and inflation is expected to remain low for some time. For example, the minutes from the June FOMC meeting reveal that the Federal Reserve Board staff outlook is for inflation to remain below 2 percent over the next few years.