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Fed will be tested in 2021 as vaccines boost U.S. economic outlook

A sharp increase in demand as COVID-19 inoculations allow more of the economy to reopen could push inflation above the Fed’s 2% target, at least for a time, says Andrew Hunter, senior U.S. economist at Capital Economics.


At that point, “the Fed may have to take slightly clearer steps to emphasize that they are not going to raise rates,” Hunter said.

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