Inflation: The Fed’s new reaction function

12 November 2019

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  By John Bellows, Ph.D., portfolio manager, Western Asset   The Fed is becoming more focused on realised inflation and growth and it should remain accommodative even if global growth turns out to be more resilient than currently believed.   Executive Summary Faced with stubbornly low inflation that has failed to reach the Fed’s 2% target for any meaningful period of time, Fed officials are tweaking the Fed’s reaction function....

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