Inflation is Coming Down, but the Journey Now Looks More Bumpy
Great overview of the current inflation situation. I appreciate the focus on the goods sector, as from my understanding of the recent research, the supply side issues actually have much larger effects not only because of lag effects but also they are still present - as you highlight in the car industry, but also equipment, bakeries and so on. Research by Lorenzoni and Werning show that supply side needs to fully return for inflation pressures to subside (not just ease, as many point talk about). The recent data published today by the New York Fed, show an uptick in the goods sector. I went over this research and posted a description of it on my substack, in case you're interested in more details.