Economic Growth and Low Inflation
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The economy is strong and inflation has remained low. The recent price increases on some commodities were caused by a recovery from the very low prices realized during the recession and Asian economic problems from a few years ago. There were also increases in prices do to increased demand, unexpected by the market, from China and also the new free market economies of central Europe. Economic growth in of itself doesn't cause inflation and can also lower prices through economies of scale. When the price of oil declines, that will result in lower prices for many items and less inflation. Some indicators did show inflation coming. However, the indicator gold and silver dropped in price and the dollar is on the rise  which holds down prices. Food commodities seem to be topping out. Farmers are finally making good money, for so many years farmers sold at cost . It's not rising farmers costs causing the higher prices but rather demand has bid up commodities. They would have little problem increasing supply which would hold prices down. With the strong economic growth we have now, we will see increasing production in so many areas, from farming to manufacturing to housing to new products. These new supplies will increase competition and price declines. The Fed said, "....,long-term inflation expectations appear to have remained well contained." The is little need for the Federal Reserve to increase interest rates. Interest rates are low compared to more recent years but historically they aren't if you go back many decades. There were long periods of time that interest rates were in the low single digits. Unless there are increases in the money supply and nowhere for the money to go but higher prices, inflation will remain low and economic growth will continue at strong rates. Increasing world wide demand will tend to increase prices, but also, world wide increased supplies will hold down prices. People will want higher pay but as long as productivity increases along with pay hikes that shouldn't cause inflation. Sometimes the economy is in a good position, that is where we are now. Isn't that the market economy at it's best?