Gary Siegel

With inflation expectations eclipsing economic slack in driving inflation, policymakers will need to keep expectations in line to avoid “large swings in inflation,” according to researchers at the Federal Reserve Bank of San Francisco.

Consumers’ inflation expectations held, while respondents showed more pessimism about the economy.

The Federal Open Market Committee needs to be careful because the market expects low inflation and the yield curve remains quite flat, Federal Reserve Bank of St. Louis President James Bullardsaid late Thursday.

Consumer credit increased by $16.6 billion in December to $4.010 trillion, the Federal Reserve reported Thursday.

Newly issued Treasury securities held in stripped form increased about $2.97 billion in January to a total of $301.182 billion.

Reserve balances still affect the fed funds rate, according to Federal Reserve Bank of Kansas City Senior Economist A. Lee Smith.

The U.S. international trade gap narrowed to $49.3 billion in November from $55.7 billion in October, the Commerce Department reported Wednesday.

The Federal Reserve can be patient and watch the economy without changing monetary policy for “the next several months,” according to Federal Reserve Bank of Dallas President Robert Kaplan.

The U.S. services sector expanded at a slower pace in January as the non-manufacturing index dropped to 56.7 from 58.0 in December.

Monetary policy is well positioned, Federal Reserve Bank of Cleveland President Loretta Mester said Monday evening.