More “noise” from the futures markets

Source: Barchart

  
Live cattle: Aug-14 contract –
 

Source: Barchart

These price increases are mostly driven by exogenous factors such as the 2012 drought and the Porcine Epidemic Diarrhea virus. Nevertheless combine this with higher energy and shelter prices and it's not simply Yellen's CPI “noise”: 

Steve Liesman, CNBC: Is every reason to expect, Madam Chair, that the PCE inflation rate, which is followed by the Fed, looks likely to exceed your 2016 consensus forecast next week? Does this suggest that the Federal Reserve is behind the curve on inflation? And what tolerance is there for higher inflation at the Federal Reserve? And if it's above the 2 target, then how is that not kind of blowing through a target the same way you blew through the six and a half percent unemployment target in that they become these soft targets? Thanks. 

Chair Yellen: Well, thanks for the question. So, I think recent readings on, for example, the CPI index have been a bit on the high side, but I think it's– the data that we're seeing is noisy . I think it's important to remember that broadly speaking, inflation is evolving in line with the committee's expectations.