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MNI INTERVIEW: US Growth Too Firm For Fed To Hit 2%-Blanchard

MNI interviews ex-IMF chief economist Olivier Blanchard about U.S. monetary policy.

The economy and job market are likely still too strong for the Federal Reserve to be able to begin cutting interest rates soon, and additional hikes, while not the baseline, cannot be ruled out, former IMF chief economist Olivier Blanchard told MNI.

Most of the downward move in inflation since its 2022 peak was due to relative price shocks fading, said Blanchard, who recently published new research with former Fed Chair Ben Bernanke entitled “An Analysis of Pandemic-Era Inflation in 11 Economies.”

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The economy and job market are likely still too strong for the Federal Reserve to be able to begin cutting interest rates soon, and additional hikes, while not the baseline, cannot be ruled out, former IMF chief economist Olivier Blanchard told MNI.

Most of the downward move in inflation since its 2022 peak was due to relative price shocks fading, said Blanchard, who recently published new research with former Fed Chair Ben Bernanke entitled “An Analysis of Pandemic-Era Inflation in 11 Economies.”

Keep reading...Show less