Business • Economy
2020-08-28T04:00:02+00:00

US: Powell announces new Fed approach to inflation that could keep rates lower for longer

Fed Chairman Jerome Powell announced a major policy shift Thursday to "average inflation targeting."

That means the central bank will be more inclined to allow inflation to run higher than the standard 2% target before hiking interest rates.

"Many find it counterintuitive that the Fed would want to push up inflation," Powell said in prepared remarks. "However, inflation that is persistently too low can pose serious risks to the economy."

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