4 ms·

One of the Fed's key charges is to maintain price stability by maintaining inflation at around 2% YOY. It should be clear by now that the Fed is unable to achi

• astonex 4y ago
  As are most other (or all?) OECD countries at the moment. It would be better to compare with other countries inflation instead of the 2% target at this point.
  • _heimdall 4y ago
    The Fed's charter is based on comparing against our own targets though. If the whole building is on fire, it isn't useful to say the person in apartment 3b is doing well because their place is less on fire than down the hall
  • netheril96 4y ago
    Fed is to a certain degree the central bank of the whole world. Other country faring worse does not absolve the Fed, because the Fed is the culprit for all of them.
  • areyousure 4y ago
    In case anyone is curious, the second-largest economy in the OECD (which also has a 2% inflation target) reports inflation of 2.1--2.8%: https://www.reuters.com/markets/asia/japans-may-consumer-inflation-tops-boj-target-2nd-straight-month-2022-06-23/ https://www.reuters.com/markets/asia/japans-may-consumer-inf... https://tradingeconomics.com/japan/inflation-cpi https://tradingeconomics.com/japan/inflation-cpi
• throwaway_4ever 4y ago
  “One of” It’s called a “dual mandate” for a reason. They try to maintain 2% while also lowering unemployment as much as possible. Unemployment is fine while inflation is hot, thus the 75 bps raises you’re seeing every month. But, understand that economic conditions can arise where they have to balance both hot inflation and high unemployment, neither of their ideals but involve figuring out the best trade-off.