Recent trends in the U.S. economy have been quite favorable, with robust growth in jobs and output, historically low unemployment and interest rates, and low general inflation despite rises in energy prices. Inflation in overall consumer prices has been boosted by increases in energy prices. Yet increases in prices of energy and other commodities have so far only had a modest effect on prices of non-energy goods and services. The inflation rate for prices of consumer goods and services excluding food and energy, as measured by the “core” personal consumption expenditures price index, the Fed’s preferred measure of core consumer prices, has been at or slightly below 2.0% over the past year. Forecasters see a continuation of healthy growth with core inflation remaining well contained. They also see continued healthy job gains and historically low unemployment and interest rates.