Mishkin: Fed Needs to Keep Its Eye on Inflation

The transcript features a discussion with a Columbia University professor on the Federal Reserve's recent decision, emphasizing a shift towards data dependency rather than calendar-based guidance. The conversation highlights the importance of inflation expectations and the challenges faced by central banks in achieving a 2% inflation target. It also touches on the constraints of fiscal policy, the need for infrastructure investment, and the lack of long-term fiscal planning. The professor suggests that the Fed should improve its communication strategy to better guide market expectations.

What did Professor Michigan find interesting about today's Fed decision?

How has the Fed's approach to decision-making changed according to the discussion?

What are the implications of low inflation expectations for the Fed's policy?

What challenges do central banks face in raising inflation to the target level?

What factors, according to Mickey Levy, are affecting economic growth aside from the Fed?

What recommendations were made regarding fiscal policy in relation to the Fed's actions?

How do consumer inflation expectations compare to Wall Street's expectations?