Englund

It lower inflation from early 80s was the result of China and containers it was not because the central banks inflation targets.  They missed their targets most om the time and they could not get inflation up to their 2 percent targets. Can we now expect them to be able to get inflaion down from eight och nine percent? The Fed and other central banks had been trying and failing to push inflation rates to 2%. https://englundmacro.blogspot.com/2022/11/the-fed-and-other-central-banks-had.html Jerome Powell’s Not for Turning—Yet Even at 3.75%-4% the Fed’s base rate is negative in real terms. No disinflation we can remember was achieved without rates rising above the inflation rate. T he Fed’s inflation target is 2% while personal-consumption expenditure inflation (the Fed’s favorite measure) was still 6.2% in September.  The Fed will have to watch for signs of financial trouble of the kind that hit British pension funds, but it still has a lot of anti-inflation work to do. Milton ...

 There were serious questions about whether central banks could even create inflation because there had hardly been any inflation for some 25 years. The expansionary fiscal and monetary policies coming out of the 2008 financial crisis had not generated a rise in consumer prices above the 2% target.  “They just didn’t see this coming,” Gertler said. MarketWatch 3 November 2022 https://www.marketwatch.com/story/why-did-inflation-surge-to-a-40-year-high-here-are-4-causes-of-the-worst-monetary-policy-mistake-in-years-11667318263   Inflation targeting has been successful because it managed to anchor expectations — until it did not . Wolfgang Munchau FT 19 July 2020 https://englundmacro.blogspot.com/2020/07/the-troubling-bit-is-that-these.html   What is the “Washington Consensus? Did it fail? https://englundmacro.blogspot.com/2021/09/what-is-washington-consensus-did-it-fail.html A new Washington consensus https://englundmacro.blogspot.com/2021/04/a-new-washington-consensus...