Fed's Schmid: 2% Inflation Goal Not Expected to be Met by Fed Until 2026
Fed Schmid said that the Fed is not expected to achieve the 2% inflation target until 2026. The final stages of the inflation decline to 2% may be the most challenging for monetary policy. The Fed's quantitative tightening is to some extent at odds with interest rate cuts. The Fed's balance sheet stance continues to depress yields. Moves to halt the Fed's balance sheet reduction will now be opposed. It is not desired that moves to reduce the balance sheet lead to volatility.
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