Background: The Fed inflation target
The Fed's 2% inflation target sounds simple. In practice, US monetary policy has evolved from Volcker's war on inflation to average inflation targeting and, since 2025, back to flexible inflation targeting.
Topic
Federal Reserve
A collection of 3 issues
Why the Fed just raised rates
The Federal Reserve has raised rates for the first time since 2023. Persistent inflation explains the economics, but Kevin Warsh’s appointment by Donald Trump makes the politics unusually significant.
Look under the hood: comparing Australian and US inflation
Headline inflation is 3.5% in Australia and 3.4% in the US. But Australia's underlying inflation is 3.6%, compared with US core inflation of just 2.4%.