Bullard Says Fed Will Try to Make Up for Past Inflation Misses

The video explains the Federal Reserve's new policy framework, which aims to allow inflation to rise moderately above 2% for some time to make up for past shortfalls. This approach is intended to cement market expectations at a 2% inflation target. The policy is compared to nominal GDP and price level targeting, highlighting its practical application. The decision to unveil this at Jackson Hall was strategic, providing a platform for a major speech and community consensus.

What was the significance of the Fed's decision to unveil the new framework policy at Jackson Hole?

Why was it important for the Fed to aim for inflation moderately above 2%?

How does the Fed plan to address past misses in inflation targets?

In what ways does the new policy relate to nominal GDP targeting and price level targeting?

What are the different opinions within the committee regarding the new inflation policy?