Fed Needs to Resist Opting Again for Quick and Easy
https://www.bloomberg.com/opinion/articles/2022-08-15/federal-reserve-needs-to-resist-the-easy-path-on-inflation
The markets’ latest narrative pivot on inflation is not the right one for the world’s most powerful central bank.
https://www.bloomberg.com/opinion/articles/2022-08-15/federal-reserve-needs-to-resist-the-easy-path-on-inflation
The markets’ latest narrative pivot on inflation is not the right one for the world’s most powerful central bank.
Fed Leaders Pledge Tough Fight to Keep Inflation Credibility
https://www.bloomberg.com/news/articles/2022-08-03/bullard-urges-front-loading-rate-hikes-to-boost-fed-credibility
My take:
https://thehill.com/opinion/finance/3582559-are-investors-right-in-expecting-a-dovish-fed-pivot/
The Fed, however, currently faces a self-inflicted credibility problem. Given Fed’s penchant for supporting asset bubbles and bailing out investors in recent decades, it now faces a tricky challenge as it has to convince market participants that reliance on a “Fed Put” is no longer an appropriate strategy. Since inflation is expected to remain well above the 2 percent target level for quite a while, the central bank has to forcefully persuade investors that rate cuts will not be forthcoming anytime soon.
https://www.bloomberg.com/news/articles/2022-08-03/bullard-urges-front-loading-rate-hikes-to-boost-fed-credibility
https://thehill.com/opinion/finance/3582559-are-investors-right-in-expecting-a-dovish-fed-pivot/
The Fed, however, currently faces a self-inflicted credibility problem. Given Fed’s penchant for supporting asset bubbles and bailing out investors in recent decades, it now faces a tricky challenge as it has to convince market participants that reliance on a “Fed Put” is no longer an appropriate strategy. Since inflation is expected to remain well above the 2 percent target level for quite a while, the central bank has to forcefully persuade investors that rate cuts will not be forthcoming anytime soon.