September CPI and PPI showed inflation well contained with CPI (Consumer Price Index) coming in at .2% as expected. Down from .4% the month before. The PPI (Producer Price Index) came in at .4% twice the expected amount and up from .3% the month before.

Being in a recession, as the U.S. economy currently finds itself, there should be little pressure to raise prices or wages. Inflation is likely to be muted. However, next year will be important as the economy recovers and we return to a more reasonable base of economic activity. Inflation is a monetary animal and the excess spending by the government should impact inflation and inflation expectation. Expect it to rise.