Policymakers and economic analysts have recently been concerned about potential inflationary pressures in the U.S. economy. Various economic statistics show the amount of unused productive resources has been diminishing. For example, the civilian unemployment rate has decreased and the capacity...

Many policymakers and financial market participants use the Federal Reserve's industrial capacity utilization rate as an indicator of future changes in inflation. During the past few years, however, the usefulness of the utilization rate as an inflation indicator has come under scrutiny. ; In...