Let me close with a few thoughts about the outlook for inflation and the proper stance of monetary policy. As I mentioned at the outset, I considered inflation to be uncomfortably high in 2006, and inflation remains a primary concern of mine for 2007. While we got some encouraging inflation numbers toward the end of last year, I am not convinced that underlying inflation is on a downward trend. We may simply be seeing the temporary effect of recent declines in the price of oil, which seems just as likely to rise as to fall in the future.
Short version: I'm not going to vote for lower rates anytime in the near future.
In addition, Fed Chair Yellen made similar comments a few days ago.
There is no rate cut in the foreseeable future.
