<br><div><aside class="gnt_em gnt_em__fp gnt_em_vp__tp gnt_em__el" aria-label="Video - Inflation falls for first time in 2024, but remains higher than Federal Reserve's goal"/><p class="gnt_ar_b_p">Two percent <a target="_blank" href="http://www.usatoday.com/story/money/2024/05/15/cpi-report-april-inflation-data/73687727007/" data-t-l=":b|e|k|${u}" class="gnt_ar_b_a" rel="noopener">inflation</a> is more than just the <a target="_blank" href="http://www.usatoday.com/story/money/2024/05/14/powell-interest-rates-higher-longer/73683558007/" data-t-l=":b|e|k|${u}" class="gnt_ar_b_a" rel="noopener">Federal Reserve’s goal</a>, one could argue, as it works to wrestle down pandemic-related price increases that have plagued U.S. households over the past three years.</p><p class="gnt_ar_b_p">It’s the Fed’s holy grail. Its lodestar. Its mantra.</p><p class="gnt_ar_b_p">Lately, though, the 2% target feels more like the economy’s Godot – a remedy to its inflation woes that seemed tantalizingly close not long ago but now appears further away, raising questions about whether it will arrive at all.</p><p class="gnt_ar_b_p"><strong class="gnt_ar_b_al">What is inflation, exactly?</strong><a target="_blank" href="http://www.usatoday.com/story/money/2024/05/15/what-is-inflation-definition/73704382007/" rel="noopener" data-t-l=":b|e|spike click:4|${u}" class="gnt_ar_b_a">Here's how it's defined and what the latest report means</a></p><aside aria-label="advertisement" class="gnt_m gnt_x gnt_x__lbl gnt_x__al"/><p class="gnt_ar_b_p">The dilemma may have significant implications for consumers, investors and the U.S. <a target="_blank" href="http://www.usatoday.com/story/money/2024/04/25/gdp-report-first-quarter/73437532007/" data-t-l=":b|e|k|${u}" class="gnt_ar_b_a" rel="noopener">economy</a>. Fed officials have said they won’t start cutting <a target="_blank" href="http://www.usatoday.com/story/money/2024/05/15/high-interest-rates-inflation-cancel-construction/73637163007/" data-t-l=":b|e|k|${u}" class="gnt_ar_b_a" rel="noopener">interest rates</a> – which would lower borrowing costs for millions of Americans, boost economic growth and further juice a bullish stock market – until <a target="_blank" href="http://www.usatoday.com/story/money/2024/05/15/what-is-inflation-definition/73704382007/" data-type="link" data-id="https://www.usatoday.com/story/money/2024/05/15/what-is-inflation-definition/73704382007/" data-t-l=":b|e|k|${u}" class="gnt_ar_b_a" rel="noopener">inflation</a> “is moving sustainably toward” the 2% target.</p><p class="gnt_ar_b_p"><strong>Protect your assets:</strong> <a target="_blank" rel="noopener" data-t-l=":body nav (hys)|e|auto spike click:6|${u}" class="gnt_ar_b_a" href="https://www.usatoday.com/money/blueprint/banking/savings/best-high-yield-savings-accounts/">Best high-yield savings accounts of 2023</a></p><p class="gnt_ar_b_p">But with the economy showing early signs of faltering, some top forecasters are increasingly asking some version of this question:</p><aside aria-label="advertisement" class="gnt_m gnt_x gnt_x__lbl gnt_x__al"/><p class="gnt_ar_b_p">What’s so magical about 2%?</p><p class="gnt_ar_b_p">And does the Fed really need to wait until inflation approaches the seemingly sacrosanct objective to start trimming its <a target="_blank" href="http://www.usatoday.com/story/money/2024/05/01/fed-meeting-may-interest-rate-decision-live-updates/73512761007/" data-t-l=":b|e|k|${u}" class="gnt_ar_b_a" rel="noopener">key interest rate</a>, which has hovered at a 23-year high since last summer?</p><figure class="gnt_em gnt_em_img"><img class="gnt_em_img_i" style="height:440px" fetchpriority="high" data-g-r="lazy" src="https://www.usatoday.com/gcdn/presto/2022/12/15/USAT/470dcd6b-af7b-48ba-9bd4-3fc61a07c4ad-AFP_AFP_333T6WH.jpg?width=660&height=440&fit=crop&format=pjpg&auto=webp" srcset="https://www.usatoday.com/gcdn/presto/2022/12/15/USAT/470dcd6b-af7b-48ba-9bd4-3fc61a07c4ad-AFP_AFP_333T6WH.jpg?width=1320&height=880&fit=crop&format=pjpg&auto=webp 2x" decoding="async" alt="Federal Reserve Chair Jerome Powell speaks at a news conference."/></figure><p class="gnt_ar_b_p">“I don’t think 2% is the right number,” says Mark Zandi, chief economist of Moody’s Analytics. “Don’t sacrifice the economy on the...</p></div> <style> .wrapper { text-align: center; } </style> <div class="wrapper"> <a class="button" href ="https://www.usatoday.com/story/money/2024/05/20/fed-inflation-goal-too-rigid/73718450007/">Read more <span>➤</span></a> </div>
