Fed's Gary Stern Says Cheaper Oil Will Help Contain Inflation

The Fed was looking for a lifeline from energy and it has received it over the last couple of weeks as oil has plummeted from over $140 a barrel to under $120. Assuming oil continues to drop or even stays in the current range, that will help alleviate the pressure for the Fed to raise rates. Gary Stern, the President of the Minneapolis Fed had this to say:

"The cheaper price of oil should lead to some slowing in the future in headline inflation,'' Stern said. "While things are playing out, perhaps as expected or maybe even better than expected, it should help to alleviate the inflation concerns and inflation pressures that we had been confronting."