Economy: As inflation booms, does recession loom?

Prices hit a new 40-year record

Inflation.
(Image credit: Kevin Dietsch/Getty Images)

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The time for debate is over, said the Financial Times in an editorial: The Federal Reserve must focus on getting inflation under control. Prices rose by a staggering 9.1 percent last month compared with a year ago, reaching a 40-year high. Until recently, it was possible to hope for a soft landing, a mild slowdown that would "tame the inflation problem and get the economy back to robust growth without too much pain." Now, though, "the decision seems straightforward: raise rates rapidly." Taking strong steps now, even if they mean a recession, is better than letting inflation turn into "a vicious cycle." If the Fed moves too fast, "it's easier to reverse course by loosening monetary policy than it is to bear down on an inflationary problem that has seeped into the groundwater."

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