NABE: Inflation More Likely Than Deflation

Washington, DC, Nov. 22, 2010 -- The National Association for Business Economics said its forecasting panel continued to rank inflation as a bigger worry than deflation.

The Fed's Nov. 3 decision to buy an additional $600 billion worth of government bonds to stimulate the economy and prevent prices from spiraling lower has been criticized both at home and abroad.

About a third of NABE panelists view the Fed's second asset purchasing program as somewhat lessening the risks of deflation, while another 33% saw the step as risking inflation.

Still, they forecast the personal consumption expenditures price index, which excludes food and energy, to rise 1.5% by the end of 2011 from a projected 1.0% this year.

That is below the Fed's considered comfort zone between 1.7% and 2.0%.