That game of chicken going on between OPEC and American oil producers? Well, it’s not like anyone asked, but rest assured that Janet Yellen won’t be the first to blink.
If Ms. Yellen and her colleagues put more weight on the looming inflation drop, they will hold off on interest-rate increases, which are expected by mid-2015. If they put more weight on underlying economic strength, they will proceed as planned, or even accelerate their move.
The signs so far are that the Fed will proceed as planned.