2022 has been a year full of uncertainties for the global economy so far, and it looks like it will continue. Rising inflation, the invasion of Ukraine, and supply chain problems arising from China and Russia… None of this makes the Fed’s job any easier. But even before all this, the Fed had begun to […]
https://www.themoneymischief.com/brace-for-impact/
The Fed announced the CPI for May: 0.6% is still at a fast pace. But I don’t think we should worry. The rates announced so far match Claudia Sahm’s predictions: If we look at the PCE index, inflation has started to made-up its dip in 2020, but this does not necessarily imply that tightening is […]
https://www.themoneymischief.com/there-is-no-reason-to-worry-yet/
In recent years, the Fed predicted inflation would be below the target. For a while, inflation remained below 2%. It has risen above 2% this year, and it looks like it will stay around for a while. Actually, this situation itself is not a problem. Last summer, the Fed switched to “average inflation targeting,” which […]
https://www.themoneymischief.com/can-overshooting-also-cause-recession/
Last summer, the Fed switched to “average inflation targeting.” The Fed’s main goal is to ensure that the PCE inflation will average around 2% over the long term and that future overshoots will compensate for any short-term discrepancies. Although a starting point is not specified, we can assume that January 2020 is the beginning. Therefore, according […]
https://www.themoneymischief.com/are-you-worried-about-inflation-dont-be/
