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The world according to Jerome: Markets on edge ahead of virtual meeting – Sydney Morning Herald
All eyes will be on the US Fed chairman as the world’s key central bankers gather virtually for their annual Jackson Hole conference this week.
For the past 12 years the Feds policy has been to target an inflation rate of 2 per cent, with the conventional central bank aim of keeping inflation below that level. The problem the Fed and other central banks have confronted is that, since the GFC, inflation has never reached that level. In the US it has averaged about 1.4 per cent.
Thats a problem because inflation thats too low encourages individuals and companies to defer spending and investment, leading to weak levels of economic activit…
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