‘There is nothing special about 2%’: BofA says the world’s central bankers just made up their inflation target

The Federal Reserve has raised interest rates six times this year in its effort to lower inflation—currently at 7.7%—to what it considers to be the ideal level of 2%. But how did the central bankers decide that 2% is ideal rather than some other number?

It’s a question several Fed critics have raised. On Friday, Bank of America was the latest to weigh in on the matter, saying bluntly, “there is nothing special about 2%.”

The Fed has company in its 2% inflation target. Several countries have the same target, seemingly giving more confirmation that 2% is perfect.

Bank of America, however, has a different take, saying that the Fed could be reluctant to adjust its 2% target to some other number because it would undermine its credibility.

https://www.msn.com/en-us/money/markets/there-is-nothing-special-about-2-bofa-says-the-world-s-central-bankers-just-made-up-their-inflation-target/ar-AA156qPE?ocid=msedgntp&cvid=f1ac9be704ac4fd4b3b7db28e76b8b51