Fed Ignores Rising Inflation as August Prices Climb

Another month goes by, and the Fed’s 2% inflation target remains a distant paradise. Even though inflation has actually increased by some metrics, the Fed has nonetheless fired up the money printers, revealing it cares more about political ends than keeping prices stable.

The following article was originally published by the Mises Institute. The opinions expressed do not necessarily reflect those of Peter Schiff or SchiffGold.

The Federal Reserve is set to lower the target policy interest rate this week in spite of the fact that price inflation rose again in August. The Fed has, for many years, insisted that it is equally committed to both sides of its so-called “dual mandate” of pursuing both “price stability” and maximum employment. Yet, the Fed is increasingly showing that price inflation is not even one of the central bank’s chief concerns. If the Fed cuts the target federal funds rate on Wednesday, we will know that what really matters for the Fed is not price inflation. What really concerns the Fed is ensuring the Treasury has access to cheap credit while attempting to help the administration politically by temporarily driving up employment numbers with ever higher levels of monetary inflation. 

CPI Inflation Rose in August