Punt!

A newsflash on financial TV, taken directly a Fed speech, stated that food inflation was reflection of increased demand from emerging markets. Perhaps, this is why the inflation/deflation (disinflation) debate still finds a forum today despite the secular trends.

Headline: Inflation or Disinflation??

Labor costs are often cited as a reason why the U.S. is not heading into an inflationary period, even as commodities prices continue to soar.

Today's report on productivity and labor costs showed that the American workforce was more productive in the fourth quarter, but it also showed continued downward pressure on wages.

Employee output per hour rose at a 2.6 percent annual rate, but labor expenses, expected to rise, fell 0.6 percent quarter-over-quarter. Economists, when measuring inflation, look at the smoother, year-over-year trend which shows a 0.2 percent decline in labor costs.

Source: finance.yahoo.com