Very loosely, this is focused on what to do when all conventional economic metrics suggest that it might be time to raise rates, but inflation remains stubbornly grounded regardless.
Kit Juckes at Societe Generale picks up on the theme this Friday:
Once upon a time, we had a whole array of rules to help think about monetary policy -the Phillips curve, NAIRU, the Taylor Rule, even MV=PY (an identity not a rule) and Goodhart’s Law (that anything a central bank targets will mis-behave like a moody teenager). But increasingly, central bankers are throwing away their playbook. In the UK and US, unemployment rate triggers chosen to frame forward policy guidance are set to be revised because they will be reached before the central banks are ready to raise rates. Even at the ECB, there is acknowledgement that the link between economic activity and inflation has ‘become more tenuous in recent years’.