The Fed’s New Strategy Could Keep Rates Low For Longer Than You Think
Aug 28, 2020
The Federal Reserve announced a major strategy shift Thursday that will likely keep interest rates low for longer to let prices rise and jobs flourish. After an 18-month review, the Fed announced changes to its long-term strategy that are designed to help the central bank meet long-elusive inflation goals. The new strategy, unexpectedly laid out in detail in a speech by Fed chief Jerome Powell, declares that the central bank will now seek to achieve inflation that average 2% over time. That means after periods of low-inflation — such as the dozen years following the Great Recession — the Fed will allow inflation to run hot by climbing above 2%. Read more at CNN Business.
