Opinion
Why the Federal Reserve won’t commit
As with anyone who’s reluctant to define the relationship, there is a method to the Fed’s wily ways. At a vastly uncertain moment in the American economy, central bankers want to keep their options open.
Jeanna SmialekMark Carney, the former Bank of England governor, was once labelled the United Kingdom’s “unreliable boyfriend” because his institution had left markets confused about its intentions. Jerome Powell’s Federal Reserve circa 2023 could be accused of a related rap: fear of commitment.
Powell’s Fed is in the process of raising interest rates to slow the economy and bring rapid inflation under control, and investors and households alike are trying to guess what the central bank will do in the months ahead, during a confusing economic moment. Growth, which was moderating, has recently shown signs of strength.
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