When inflation returns to previous high levels (like 2023), central banks such as the Federal Reserve must respond by increasing interest rates to combat inflation, as demonstrated by the aggressive rate hikes during 2022-2023.
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CPI inflation has crept back up to where it was in 2023. Back then, the Fed had to hike aggressivelyAdded:
We're living in upside-down world, where the bad news is actually good. If something bad happens to the economy, it's actually good for risk assets because it means we will be printing.
We'll be printing big. But in overall, if you look at the inflation now that has come in, it's too high. I mean, you have now CPI inflation, it's the same as it was in 2023. And the Fed had to hike rates. They had to increase rates a lot during those 2022, 2023 times.
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