An April 2023 NBER paper warns that the Fed’s rapid tightening actions since 2022 were a monetary shock that has negative economic impacts for this year and next. Mind the lags. See Does Monetary Policy Matter? The Narrative Approach after 35 years; the conclusion:
“Based on the empirical estimates of the effect of previous shocks, one would expect substantial negative impacts on real GDP and inflation in 2023 and 2024.”
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