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 includes offsetting periods below 2% with periods above 2%(and vice versa).
Can overshooting also cause recession?
Can overshooting also cause recession?
Can overshooting also cause recession?
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 includes offsetting periods below 2% with periods above 2%(and vice versa).