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Get used to it: High-for-longer interest rates will be the new normal
It may also be time for central banks to relook their inflation targets.
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One has to wonder whether the Fed’s 30-year-old inflation target of 2 per cent is still relevant in today’s geopolitical context.
PHOTO: REUTERS
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US Federal Reserve boss Jerome Powell’s address to the Jackson Hole Economic Symposium last week turned out to be almost a non-event.
Unlike 2022, when markets plunged as he indicated that the Fed would take an increasingly hawkish stance with interest rate rises to stem inflation, this time he seemed to suggest a more nuanced approach.
