Plosser Says Fed Must Defend 2% Explicit Target for Inflation
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Federal Reserve Bank of Philadelphia President Charles Plosser said the central bank should take the steps necessary to ensure inflation stays near its goal of 2 percent.
“It is important that the Fed credibly commit to defending that target either on the upside or the downside,” Plosser said today to a meeting of economists in San Diego. “Right now, it would not be good either for our credibility or for the economy for us to have deflation. For the Fed at this point, we have established a target and we need to defend that target.”