Fed Officials See Benefits in Letting Inflation Run Above Target
- Dudley says a small, temporary overshoot wouldn’t be a problem
- Policy maker comments come as price pressures begin to build
Aviva Investors' Diebel Says 10-Year Notes Could Easily Get to 2.75%
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Federal Reserve policy makers are openly voicing their willingness to accept above-target inflation even as price pressures are beginning to build.
“Let me be clear: A small and transitory overshoot of 2 percent inflation would not be a problem,” William Dudley, president of the Federal Reserve Bank of New York, said in a Jan. 11 speech. “Were it to occur, it would demonstrate that our inflation target is symmetric, and it would help keep inflation expectations well-anchored around our longer-run objective.”