Caution! The thing the Federal Reserve fears the most is happening: the risk of inflation expectations spiraling out of control is surging

The Boston Federal Reserve report indicates that current inflation expectations have risen sharply, posing greater risks for the Federal Reserve in controlling prices. Unlike in the past, the upward adjustment of households' one-year inflation expectations is not primarily driven by food and energy prices, increasing the risk of inflation remaining persistently above the 2% target. Research shows that the surge in inflation expectations may indicate that risks have significantly increased, but are still within a controllable range. Federal Reserve officials regard the University of Michigan survey results as "outliers," while other indicators remain consistent with the target