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Central Banks

Powell Abandons Soft Landing Goal as He Seeks Growth Recession

  • Fed chief wants weak growth, soft jobs market to cut inflation
  • ‘It’s a bit like dripping water torture,’ economist Swonk says

Forget about a soft landing. Federal Reserve Chair Jerome Powell is now aiming for something much more painful for the economy to put an end to elevated inflation. The trouble is, even that may not be enough.

It’s known to economists by the paradoxical name of a “growth recession.” Unlike a soft landing, it’s a protracted period of meager growth and rising unemployment. But it stops short of an outright contraction of the economy.