- Chicago Fed President Austan Goolsbee said the path to 2% inflation is unlikely to be painless and called the environment a stagflationary trade-off between employment and inflation.
- Goolsbee said the Fed cannot ignore repeated and persistent supply shocks and must respond even when the adjustment causes economic hardship.
- The Chicago Fed National Activity Index came in at -0.04 in August, above the -0.08 consensus but down from a revised +0.08 in July, signaling cooler economic growth.
Quotes
“exactly the kind of painful trade-off between employment and inflation that stagflationary shocks always impose on the central bank.”
“The Chicago Fed National Activity Index came in at -0.04 in August, better than the -0.08 consensus but a reversal from +0.08 in July (revised from -0.08)”