What are the impacts of Inflation?
HOW DOES INFLATION IMPACT YOU?
The Federal Reserve has three main goals:
At the beginning of the pandemic, they prioritized maximum employment. Inflation was, and is, a result of the easy money policy "tool" they used to prioritize maximum employment. The Fed appears to have achieved their goal of keeping employment levels at an acceptable level, even thru a global shutdown, and now have shifted focus on lowering inflation. The Federal Reserve, since 2012, explicitly has targeted an average 2% inflation rate over time. It is unlikely they move this target in the foreseeable future. Inflation is well above 2% now, and will likely go down in the immediate future; however, in the long run, the average inflation rate should be extremely close to 2%.
- Maximum employment
- Stable prices
- Moderate long term interest rates
At the beginning of the pandemic, they prioritized maximum employment. Inflation was, and is, a result of the easy money policy "tool" they used to prioritize maximum employment. The Fed appears to have achieved their goal of keeping employment levels at an acceptable level, even thru a global shutdown, and now have shifted focus on lowering inflation. The Federal Reserve, since 2012, explicitly has targeted an average 2% inflation rate over time. It is unlikely they move this target in the foreseeable future. Inflation is well above 2% now, and will likely go down in the immediate future; however, in the long run, the average inflation rate should be extremely close to 2%.
