For SF Fed president Janet Yellen, it’s deflation first, inflation later:

I’ll put my cards on the table right away. I think the predominant risk is that inflation will be too low, not too high, over the next several years.  …  First of all, this very weak economy is, if anything, putting downward pressure on wages and prices. We have already seen a noticeable slowdown in wage growth and reports of wage cuts have become increasingly prevalent—a sign of the sacrifices that some workers are making to keep their employers afloat and preserve their jobs. Businesses are also cutting prices and profit margins to boost sales. Core inflation—a measure that excludes volatile food and energy prices—has drifted down below 2 percent. With unemployment already substantial and likely to rise further, the downward pressure on wages and prices should continue and could intensify.

For these reasons, I expect core inflation will dip to about 1 percent over the next year and remain below 2 percent for several years. If the economy fails to recover soon, it is conceivable that this very low inflation could turn into outright deflation.