Rate cuts with little risk? The unexpected taming of US inflation.
When it comes to economics, expectations often become reality. One prime example: the risk of inflation unexpectedly tamed at the same time consumers’ fears of it subsided.
Inflation – the rip-roaring variety that skyrocketed prices in the 1970s and shrunk pay raises to irrelevance – has gone missing for a long time in the United States.
Even in boom times, like now, price rises have been tame. And no one is quite sure why.
Against this backdrop, the Federal Reserve today cut interest rates for the first time since the...