Yellen’s claim that unexpectedly low inflation is due to “idiosyncratic” factors is ridiculous. But Commerzbank economist Ulrich Leuchtman put it pithily, as reported by Bloomberg:

Yellen cited “special effects” — eg. mobile phone contracts — as a reason for soft price data. I’m not quite sure I buy these arguments about special effects and the transitionary nature of low inflation. I know I shouldn’t quote one analyst twice in one day, but Ulrich Leuchtmann at Commerzbank put it far more succinctly than I do. And being an Elvis fan, I cannot resist citing his comments:

“I am fed up with these words, special effects. ‘From exchange-rate effects to monsoon effects in India: wherever you look inflation surprises to the downside and everywhere analysts excuse this development with special effects.’ I am more inclined to believe that Elvis is still alive than believe that all those effects coincidentally point in the same direction.”