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Inflation holds the key to Fed's 'lift-off'

If prices remain stalled as the Fed tightens, 'real' rates will rise faster than desired, and threaten the recovery


FEDERAL Reserve officials planning to lift interest rates as soon as September have been encouraged by solid US jobs growth, but inflation holds the key to how far the Fed can go in moving rates away from zero.

Fed officials have said that they do not need to see prices...

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