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Re:Federal Reserve Now Projects Rate Increases in 2023 as Ec... by ls612 on Wednesday June 16, 2021 @03:55PM (#27532765)
The reason is more technical than that. For a long time the Fed has had a target of 2% PCE inflation (which is a bit higher than 2% CPI inflation), but in the past decade it’s averaged 1.5% or so. This damages central bank credibility, a very important asset for monetary policy. Thus, policymakers are comfortable running 3% or so PCE inflation for a while to try and bring up the long run average to the 2% stated target.

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