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Opinion
Brian Chappatta

Fed’s Infighting Shows It Lacks Answers About Inflation

A senior economist at the central bank offers a stark contrast to Chair Jerome Powell’s focus on expectations about the pace of price growth.

Is Fed Chair Jerome Powell’s focus on inflation expectations warranted?

Is Fed Chair Jerome Powell’s focus on inflation expectations warranted?

Photographer: Michael Nagle/Bloomberg

A day after Federal Reserve Chair Jerome Powell said at a press conference that “inflation expectations are terribly important,” Jeremy Rudd, a senior Fed economist who has served at the central bank since 1999, released a new paper.

The title: “Why Do We Think That Inflation Expectations Matter for Inflation? (And Should We?)” His answer to the parenthetical question was a resounding no.