It is almost conventional wisdom that commodity (particularly oil now) "
price shocks![](https://lh3.googleusercontent.com/blogger_img_proxy/AEn0k_uzmG59O45OlhKPAbEhmXGEKQceJvVXp29jHhNsatBNpT8CK2W4xXII8dIn0AMzYdyY7xhOO2yrYI6smXU0qf8cnFynW6WlbfaeGJds5-8FpQJcdSyF75NzXs8YPd9okhw5Qps2lmsJ9pMfJxJEv97erk13NtB8j9sWUm8zzyB4Tg=s0-d)
" or spikes have an affect on
inflation![](https://lh3.googleusercontent.com/blogger_img_proxy/AEn0k_tCXEyZHzc5ZYIo5dXXnCISX86wFTnh2JDLVVy7x8CpfYka3raQQPoSKKfBF0_gDH4VvamqRD5qSltTtHLulTnpUfRABiI8fpG4WotDLT-3ED4sLUTrlCdA0x2H82x0RDScYnStUmqEh0Tb-tPtQlppXtJ7Wsly8mcjEpiOknSxK_w=s0-d)
. The Chicago Fed has a
new paper (.pdf) that says quite the contrary. For a quick perspective, here is a handy-dandy chart from the
IMF![](https://lh3.googleusercontent.com/blogger_img_proxy/AEn0k_vpIfPDHHgeh1gJl4pMk1rwTh406RE03LnRi8Pd0qk3F1OGcPSfLxzVqwqcUh8qwZdEJbxbVpo50_hL5l_Rs7qH205p6vcnNYjftulnuSsDzObHLJj3_lCUyjTKQ2QdrDjp5m9Pi0ZxaNQ-NLY_bTmETqISSzNwVEPLDDranLY8RjM=s0-d)
that tracks the correlation between the two:
![https://lh4.googleusercontent.com/_VgJQTp0Bsf0/TaR2iwMcjcI/AAAAAAAAAbg/SjuMGMZXYfE/commodity_core.jpg](https://lh4.googleusercontent.com/_VgJQTp0Bsf0/TaR2iwMcjcI/AAAAAAAAAbg/SjuMGMZXYfE/commodity_core.jpg)
H/T -
Paul Krugman