For the Federal Reserve, policymaking these days is about deciding which of two imposing evils to take on - a decidedly moribund economy or the increasing threat that inflation poses to battered consumers.
For much of the slow slog out of the financial crisis, the Fed which is meeting this week and will issue its policy statement Wednesday, has managed to train its gaze on jump-starting growth through its various quantitative easing measures.
But recent indicators show that inflation is posing an equally daunting threat that further monetary accommodation from the Fed might serve only to aggravate.
The pressure has come primarily through measures that Fed Chairman Ben Bernanke likes to call "transitory" - namely, the volatile but steady rise of food and energy prices that don't make up core inflation measures but usually impact consumers more.
Economists increasingly believe that while the so-called core Consumer Price Index (CPI) measure has remained around the 2 percent level that pleases the Fed, headline inflation that includes things such as groceries and gasoline is becoming a growing menace. The more inclusive inflation measure is at 3.9 percent and hammering at consumers, including the 14 million who remain unemployed.
