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Rosengren: Monetary Policy in a Low Inflation and Low Unemployment Economy
In remarks on Tuesday, Boston Fed president Eric Rosengren explored the current economic environment, characterized by low unemployment and lower-than-target inflation – which are somewhat opposing signals for monetary policymakers. “The Fed’s dual mandate from Congress had not posed this type of conflict in the early years after the global financial crisis, as unemployment had been undesirably high and inflation somewhat low. Both implied the need for monetary stimulus. But today, the two elements of the Fed’s mandate are sending opposing signals for monetary policy, with low unemployment perhaps suggesting ... (full story)