US Inflation Measures Flawed, May Lead to Unnecessary Recession

Nobel laureate Paul Krugman has said that the Federal Reserve may have already won its fight against inflation and is overly fixated on flawed price measures. Krugman cautioned that the Fed risked missing out on an "immaculate disinflation" scenario if it lifted interest rates too high. The Fed's chosen inflation gauge, the Personal Consumption Expenditures index, has been cooling at a slower rate than other measures, and Krugman said the central bank was using "kind of a one-eyed bearded man with a limp measure of inflation to suggest that we are not actually seeing improvement."