Disinflation may trigger recession, say Mester and Jefferson
Fed president and governor acknowledge policy tightening is uncertain and costly
Uncertainty clouds the policy path ahead but bringing down inflation is likely to be costly, said US Federal Reserve policy-makers Loretta Mester and Philip Jefferson on February 24, commenting on research into past episodes of disinflation.
“Uncertainty is the norm, not the exception,” said Mester, president of the Federal Reserve Bank of Cleveland. “I see the risks to the inflation forecast as tilted to the upside and the costs of continued high inflation as being significant.”
Mester and
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