A Fed pivot, born of volatility, missteps, and new economic reality


As the Fed’s January meeting minutes showed, not all officials have sworn off further rate increases and some noted that a possible turn for the better – a resolution of trade tensions for example – could lead them to raise rates again.

But to veteran Fed watchers, the bar is now higher. The January statement, JP Morgan analyst Michael Feroli wrote recently, showed the Fed “subtly but profoundly evolving” to a new view of the world where a variety of forces have changed the way inflation and interest rates work, and have now changed how the central bank responds.

GRAPHIC – The Fed’s new normal: tmsnrt.rs/2VccqWm


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