Contrary to how many Federal Reserve officials have tended to focus on longer-run inflation expectations data as a tool to divine real world price pressures, a Cleveland Fed report released on Monday said shorter-run expectations may be the more important factor to watch right now, Reuters reported. In the present environment "the relationship between current inflation and short-term inflation expectations is much stronger than the relationship between current inflation and longer-term inflation expectations," Ina Hajdini, an economist at the Cleveland Fed, wrote in a commentary posted on the regional Fed bank's website. She said the annualized trend rate of inflation was 3.3% between the start of 2021 and the end of 2022, but hit 3.4% in the fourth quarter of last year, well above the Fed's 2% target. Short-term inflation expectations readings are above the fourth-quarter reading, and "these data imply that heightened short-term inflation expectations — above trend inflation — can feed into higher inflation, and this channel has become even stronger recently." That could put the U.S. central bank in a tough spot as the end of its interest rate hiking campaign comes into sight. Over the last year the Fed has boosted rates aggressively to help quell some of the highest inflation pressures seen in decades.