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Defeating inflation without higher unemployment is still unlikely
US inflation is now much slower than last summer’s red-hot pace, but it’s not guaranteed it will drift all the way down to the Federal Reserve’s 2% target without a sharp rise in unemployment. That possibility remains unlikely. Defeating inflation without throwing millions of Americans out of work — a scenario known as a “soft landing” — has always been the Fed’s “primary objective,” according to Fed Chair Jerome Powell last week. And the US economy’s surprising resilience, despite 11 rate hikes, has raised hopes of a soft landing becoming a reality. But there are many uncertainties and economic ... (full story)