Apparently, The Fed thinks is knows something about oil prices that the rest of us don’t. Otherwise, it’s 25 basis point increase on the federal funds rate is hard to explain. The CW explains that May’s decrease in consumer prices had to do with oil prices. But May’s temporary drop in oil prices couldn’t have been reflected in consumer prices that fast.
Maybe the Bush economy has been producing too many jobs for Greenspan’s comfort. The labor market might have been getting too loose, so they are tightening it.