The Fed Must Shift from 'Data Dependent' to 'Policy Dependent' Approach in 2025

Reported 1 day ago

In light of potential fiscal policies following the 2024 election, Federal Reserve Chair Jay Powell may need to evolve from a 'data-dependent' to a 'policy-dependent' stance in 2025. With unknowns surrounding Donald Trump's plans for tax cuts, tariffs, and immigration, the current solid economic backdrop, particularly persistent inflation above the Fed's target, suggests that the central bank might need to adjust its strategies to account for fiscal policy's impact on price stability and employment.

Source: YAHOO

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