Wyoming’s state motto, “Equal Rights,” might have hinted at the U.S. Fed’s new monetary policy strategy that was revealed at this year’s (virtual) Jackson Hole Economic Symposium. Chairman Jerome Powell announced changes emphasizing the importance of both inflation and labour within its mandate. But what are the risks of shifting from an inflation target of 2% to an average of 2% over time? And how will a renewed focus on employment affect interest rates and growth into 2021? Tom Porcelli, RBC Capital Markets’ Chief U.S. Economist, shares his take on how the Fed’s new approach could play out in markets and the economy.
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