Fed's Rosengren: Impact of Energy Costs Not Yet Seen

Rising food and energy costs are still trickling through the economy, complicating the outlook for inflation, Boston Federal Reserve President Eric Rosengren said on Tuesday.

Speaking on Cape Cod, Rosengren said the central bank still expects prices to trend down as the economy softens, but conceded that it is less confident in this outlook because of simmering commodity costs.

"The effects of significant increases in food and energy prices are still feeding through the economy, as are the impacts of appropriately aggressive monetary and fiscal policy responses to the recent financial turmoil,'' he said.

The United States has been struggling with twin crises in the housing and financial sectors, developments that have forced the Fed to cut interest rates sharply since September.