Comment by pipes
17 hours ago
The raising interest rates right now makes no sense to me. Energy prices and layoffs will kill spending power. I think the central banks will overcompensate because they got inflation so wrong the last time.
17 hours ago
The raising interest rates right now makes no sense to me. Energy prices and layoffs will kill spending power. I think the central banks will overcompensate because they got inflation so wrong the last time.
inflation has been persistently > 2% (and arguably much more, as the current methodology on how to measure inflation is quite flawed). There's a definite risk of inflation expectations shifting, which central bankers really want to avoid.
Your point that there's a recessionary risk is real, but lowering rates might lead to stagflation. Both options are pretty bad honestly.
Can you elaborate on what you mean by "central banks got inflation so wrong the last time"? You mean Covid or 2008?