Fed economist says 2% too low for inflation


John Williams, the director of research at the San Francisco Federal Reserve, has said that central banks may need to up their inflation target to as high as 4% in order to stave off the dangers of the zero lower bound.

In a paper presented at a Brookings Institution conference on Thursday, Williams said the macroeconomic costs of the zero lower bound necessitated an inflation target of between 2% and 4%.

The economist said a 2% target would act as a sufficient buffer against the zero lower-boun

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