The Federal Reserve has not been this far “behind the curve” for a year or so, the former US Treasury secretary said.
and to address the growing credibility problems that the Fed has”, Summers said.
Seasonal revisions to the consumer price index that took the downward trend of inflation out of the data for the last several months of 2022.The personal consumption expenditures price index also picked up.Wage figures “no longer show the kind of reductions that we had been expecting.”Once again, “the arguments made by Team Transitory have unfortunately looked more like wishful thinking”, said Summers, who has also said in recent weeks that there’s a risk of a sudden economic slowdown.
Summers also criticised a push by progressive Democrats to shape President Joe Biden’s pick for the Fed vice chair position that’s now open.Massachusetts Senator Elizabeth Warren wants Biden to select a vice chair to counter Powell, who she said “has made clear that he will take extreme steps on interest rates, and he’s willing to put millions of people out of work”.
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