The fed still meets again twice this year and may yet raise rates. The one thing stopping them is tricky. On the one hand there were 3 consecutive months of deflation of the CPI. The saving grace was that it was spread over 2 quarters. Inflation is at 0.2%, which is well short of the 2% goal for raising rates. Raising rates with deflation would make the deflation worse due to the impending credit crunch constricting consumer buying of all assets and services.
This is all fun and games and I do back up the mini van but before I get really excited by these figures I remind myself that deflation was at 15% going into the 20s and leading into the great depression. Oil is definitely playing a big part in the deflationary forces though and I am excited when I see the oil price teeter on the edge of $40, with the stockpiles going down and not being replenished. It would definitely smack the US oil industry around a little and crash some bonds for us. And with the Iran nuclear deal on the table it looks as if the third largest OPEC producer is about to bring it's supply to the world. I have read that Iran has tankers filled with oil ready at port to go wherever they can to sell. That cant be good for the price of oil.
I am excited but I am not that excited. These problems are not yet critical. But move that dirt.
