The problem: many central banks are pledging to stamp out inflation, “whatever it takes”

Inflation today is the manifestation of a deeper regime shift: the end of the “Great Moderation 

People have long thought this remarkable feat was the result of good policy. There’s an alternative hypothesis. Perhaps it was just good luck. 

The only way to bring inflation down is to crush the interest-rate sensitive parts of the economy that are not responsible for today’s inflation.

We are facing the starkest trade-off between inflation and growth since the early 1980s. Central banks will have to crush the economy to kill inflation. Or we might be forced to live with more inflation. 

This is not a trivial choice.

Jean Boivin FT 4 July 2022

https://www.ft.com/content/feabcdca-8f7d-47ee-8bc1-dd30c23b9354

The writer is head of the BlackRock Investment Institute and former deputy governor of the Bank of Canada

The “Great Moderation” is the name often given to the period from the mid-1980s to 2007, 

when the Federal Reserve kept inflation and economic growth relatively stable… until it all collapsed in spectacular fashion in the global financial crisis of 2008.

Englund: Has the ‘Great Moderation’ returned — and is that a good thing? (englundmacro.blogspot.com)