The threat of such so-called disinflation is worrisome, Minneapolis Fed President Narayana Kocherlakota said, because it means inflation is moving away from, and not toward, the Fed's 2 percent goal.
Kocherlakota repeated his view that inflation will rise back to 2 percent over the next three years, but said he is more worried about the downside risk to that forecast than the upside risks. (Reporting by David Bailey; Writing by Ann Saphir; Editing by Leslie Adler)