The Federal Reserve on Wednesday will launch one of the most difficult tasks a central bank can attempt: Raise borrowing costs enough to slow growth and tame high inflation, but not so much as to topple the economy into recession.
The Federal Reserve on Wednesday will launch one of the most difficult tasks a central bank can attempt: Raise borrowing costs enough to slow growth and tame high inflation, but not so much as to topple the economy into recession
The Federal Reserve on Wednesday will launch one of the most difficult tasks a central bank can attempt: Raise borrowing costs enough to slow growth and tame high inflation, but not so much as to topple the economy into recession. With a war raging in Europe and price increases at a four-decade high, Fed Chair Jerome Powell will seek to engineer a “soft landing”: A gradual slowdown in economic activity that helps curb surging price hikes, while keeping the job market and economy expanding. “You’ve got to be both lucky and good” to avoid causing a downturn, said Alan Blinder, a Princeton University economist who served as vice chair of the Fed from 1994 to 1996, when the central bank was widely seen as having successfully raised rates without triggering a recession.