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Why Is 2 Percent The Federal Reserve’s Magic Number For Inflation? | FiveThirtyEight

By Albert Thomas March 9, 2023 0 mins read 288 Views

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The Federal Reserve tries to keep inflation around 2 percent, and it raises interest rates when inflation gets too high. But raise interest rates too much and it could cause a recession. So why did the Fed decide that 2 percent inflation is the way to go? Why not 3 percent? Or 12 percent? For that matter, why not 0 percent?
#inflation #federalreserve #recession

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