ONE year ago, Jay Powell threw out the rulebook global investors had used for over a decade.
Long dormant inflation had been picking up as pandemic lockdowns eased, but for months central bankers such as Federal Reserve chair Powell had urged households, businesses and investors not to panic. The rapid burst of price increases, they insisted, would prove transitory.
But on November 30 2021, Powell publicly accepted that assessment might have been wrong. Speaking at a congressional hearing, he said inflationary pressures were “high”. The annual rate was running at 6.8 per cent at that point, far above the Fed’s 2 per cent target. Ending the Fed’s stimulative bond purchases might need to...
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