The Federal Reserve should focus on keeping inflation stable rather than try to push unemployment lower with unconventional policies that risk stoking higher prices, a top Fed official said Tuesday.
Philadelphia Fed President Charles Plosser, widely seen as an inflation hawk, argued that any attempt to juice economic activity by creating inflation was doomed to fail.
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``Sometimes these arguments are opportunistically couched in terms of alternative policymaking frameworks, such as nominal GDP targeting, or price-level targeting. Regardless of the name, though, I believe the main motivation for many is to raise inflation,'' said Plosser, who is taking part in a Fed subcommittee aimed at reviewing the U.S. central bank's communications strategy.