Macro Quick Hit: The Fed Inappropriately Downplays Inflation Target Progress
Fed Chairman Powell said in July: “for quite a while here, we’ve been in the range of achieving our maximum employment goal,” however, “we’re only just getting there with inflation … I wouldn’t declare victory on that yet.” Powell also said he is still “slightly more worried about lower inflation.” We disagree with Powell that lower inflation is a greater risk and we think Powell’s downplaying of the progress toward the inflation objective is unwarranted. In the attached Macro Quick Hit we discuss inflation relative to the objective, revisions to historical PCE prices, and broader indications of inflation trends.
RDQ Economics provides global macroeconomic consulting services with an emphasis on U.S. economic fundamentals and monetary policy.
Our views are driven by consistent application of classical economic and monetary principles and has generated superior anticipation of changes in the stance of monetary policy and of movements in economic growth and inflation.
The founders of RDQ Economics, John Ryding and Conrad DeQuadros, have a combined experience of 26 years on Wall Street, 12 years of experience in central banking at the Federal Reserve and the Bank of England and nine years in the independent research space. John and Conrad have worked closely with fixed income, foreign exchange, and equity traders and portfolio managers, which has enabled their analysis and advice to be tailored to a clientele that is focused on trading and investment decisions.
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