Commentary Federal Reserve (Fed) policy has at last begun to address building inflationary pressures. Though Fed Chairman Jerome Powell continues to dismiss the recent inflationary spike as “transitory” and nothing to warrant a policy adjustment, the Fed has in the last few weeks made anti-inflation efforts to absorb some of the liquidity the central bank has poured on markets in the past. This latest change will fall short of needs should the inflation persist, but the policy move, tentative though it is, shows a welcome responsiveness that until now had been absent. This latest action hardly constitutes a major policy shift. Nor should the Fed make one just now. To be sure, inflationary pressures have developed this year. The Labor Department’s consumer price index has risen at over a 7 percent annual rate so far in 2021, far faster than any time in more than almost two decades. The same …
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