Fed should ditch current policy framework, group of former top central bankers says
WASHINGTON (Reuters) -A group of former top world central bankers says the Federal Reserve should scrap its nearly five-year-old bias towards jobs and keep a stricter focus on inflation, a recommendation offered as the U.S. central bank conducts its own strategy review. The Fed should "always seek to bring inflation back to its 2% inflation target" and drop the current pledge to use periods of high inflation to offset periods when prices rise too slowly, said the panel, chaired by former New York Fed President William Dudley and including former central bank officials from China, Mexico, Japan, England, and Israel. The current approach of ignoring low unemployment as an inflation risk and viewing maximum employment as a "broad-based and inclusive goal" should also be dropped, the group said.
