US Federal Reserve chair Jerome Powell. Picture: BLOOMBERG/AL DRAGO
Fed watchers had varying interpretations of Rudd’s paper. Some saw it as validating the new policy framework about inflation, which aims for observed price growth that modestly overshoots 2% for some time rather than making decisions based on potentially erroneous forecasts. Others viewed it as a warning: counting on surveys that show stable longer-term inflation expectations runs the risk of missing a real-time regime shift in the economy.
This is what Rudd suggests on monitoring for evidence of an inflation regime shift: “One development to watch for would be any evidence that a renewed concern with price inflation was starting to affect wage determination — either in statistical form … or in the form of anecdotes.
Should the quits rate stay elevated for many more months, however, it might raise concern that cost-of-living increases are starting to become front and centre in the minds of workers. As my Bloomberg Opinion colleague Noah Smith wrote earlier in September, even though US wages have been rising strongly lately, on an inflation-adjusted basis, they are lower than they were in May 2020.
The Fed wants to talk a big game on inflation and push expectations higher because policymakers believe that will keep price growth above their 2% target. Rudd argues that:Policymakers should strive to keep inflation off people’s radar; and“I view Rudd’s policy implications as an indictment of the Fed’s new policy framework,” Tim Duy, a former Bloomberg Opinion contributor who is now chief US economist at SGH Macro advisers, wrote in a report. “There is clearly some internal conflict.
South Africa Latest News, South Africa Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Bonds hit by sell-off as inflation fears spook investorsYields on 10-year bonds reached their highest level since May
Source: BDliveSA - 🏆 12. / 63 Read more »
Soaring inflation expectations see global stocks fall for third dayBond yields surge with 10-year Treasury touching highest level since June 17 as spectre of rate increases grows
Source: BDliveSA - 🏆 12. / 63 Read more »
Asian shares inch higher as risk-on sentiment returnsEquities rise, though a surge in oil prices to three-year highs may inflame inflation fears and aggravate central banks’ recent hawkish turn To all those Bitcoiner’s working from home Bitcoin trading options Here's a little tip: Get a trusted Bitcoin expert and stick with her lisamiaBTC Invest and play at similar times each day. Because : In times of chaos, your investment is your anchor to success. Words alone won’t express how thankful I’m recommending you all to you shantelll_142 .....,investing with you has been a good opportunity for me and my family I just received my profit of R60,000 within 7 days of investment shantelll_142
Source: BDliveSA - 🏆 12. / 63 Read more »
Boston Fed’s Eric Rosengren announces early retirement amid trading scrutinyRosengren will retire this week due to a health condition after 14 years as Boston Fed president
Source: BDliveSA - 🏆 12. / 63 Read more »
LIVE FEED: ANC launches maifesto ahead of local government electionsThe party's President Cyril Ramaphosa is expected to address the attendees at 7pm Yho....so many old people on stage...haai ANC must really transform. To cap it all, some old lady is sanitizing on stage, she should be home resting!
Source: IOL - 🏆 46. / 51 Read more »
Durban a sea of white as Shembe followers embark on peace walkThe roads around King Dinuzulu Park in central Durban were a sea of white as masses of worshippers gathered on Tuesday morning.
Source: TimesLIVE - 🏆 28. / 59 Read more »