Bullard Says Fed Has to Be Nimble Coming Out of the Pandemic

The transcript discusses a new inflation framework allowing inflation to exceed targets temporarily. It projects headline PCE inflation at 3.4% and core PCE at 3% for 2021, with some persistence into 2022. The speaker emphasizes the need for readiness to address potential inflation risks and highlights the importance of nimbleness in economic policy, similar to the response during the pandemic.

What was the main purpose of the new economic framework introduced?

• To maintain inflation at a constant rate

• To eliminate inflation completely

• To allow inflation to run above target temporarily

• To reduce inflation below target

What is the projected headline PCE inflation rate for 2021?

• 3.4%

• 2.0%

• 2.5%

• 3.0%

How does the strategy plan to stabilize inflation after running it above target?

• By reducing it to 1%

• By maintaining it at 3%

• By approaching 2% from the high side

• By eliminating inflation completely

What is a key characteristic of the current economic period as described in the video?

• Stability and predictability

• Low inflation risks

• High volatility and uncertainty

• Complete economic recovery

What is emphasized as necessary to handle potential inflation risks?

• Ignoring inflation trends

• Focusing only on short-term goals

• Flexibility and readiness to respond

• Strict adherence to initial plans