He sees an explicit medium-term inflation target as an anchor for financial markets and a mechanism for Fed accountability.
True, the fuel for faster recovery is amassing. But that prospect does not materially alter chances that inflation will also remain well anchored.
With higher inflation still a tangible threat, officials cannot rule out the possible need to move beyond neutral.
I don't recall a period where we had this kind of a surge in energy prices and didn't have some kind of negative fall-out.
You've got this awkward confluence of a Fed that's getting nearer and nearer to some critical level of rates and an inflation forecast that has been more in doubt or more in play than it has been for some time.
It's obvious there's a lot of hand-to-mouth production going on, as businesses are still very wary about undertaking big projects or any sort of new activity for a variety of reasons, some intangible.
The gap between rapid growth and subdued employment is a familiar story reflecting a possible 'once in a lifetime' surge in productivity.
With labor markets eroding rapidly, external growth faltering badly, and domestic inflation low and falling, the Fed can afford to err on the side of accommodation.
State and local budgets can be corrected by small changes in the relative growth rates of spending and tax revenues, rather than by jarring policy initiatives.
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