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<p>Core Personal Consumption Expenditures (PCE) –the preferred inflation measure of the Federal Reserve– climbed further beyond the central bank’s 2% inflation target to 3.5% last month.  The Fed admitted that the current pace of inflation has caught them off-guard in this week’s FOMC Meeting Announcement, yet they are keeping their foot on the monetary gas pedal in the hope that rising prices won’t persist.  While certain elements of today’s inflation caused by supply/demand imbalances will be inherently transitory, we believe there is a real risk that inflation could prove to be stickier than expected. </p>
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