Mester Expects Fed to Reach 2% Inflation Goal in 2025

The video discusses the anticipated trajectory of monetary policy, with the Fed funds rate expected to move above 5% and remain in positive territory. The policy's duration and extent will depend on economic and financial developments. Tighter financial conditions are expected to moderate demand and markets, leading to a decrease in inflation. Output growth is projected to be below trend this year, with a slight increase next year. Unemployment is expected to rise to 4.5-4.75% by year-end, while inflation is projected to decrease to 3.75% by year-end, reaching the 2% goal by 2025.

What is the anticipated movement of the Fed funds rate according to the first section?

• It will decrease below 2%

• It will remain constant

• It will move above 5%

• It will fluctuate unpredictably

What is expected to happen to demand and product markets due to tighter financial conditions?

• They will remain unchanged

• They will continue to moderate

• They will collapse completely

• They will expand rapidly

How is inflation expected to change by the end of the year?

• It will increase to 5%

• It will decrease to about 3.75%

• It will remain at the current level

• It will drop to 1%

What is the expected trend in employment growth?

• It will continue to slow

• It will reverse and increase

• It will remain stable

• It will accelerate

By what year is inflation expected to reach the 2% goal?

• 2025

• 2023

• 2024

• 2026