Fiscal Policy and Structural Reforms Matter

The dialogue emphasizes the importance of integrating fiscal policy and structural reforms into discussions about economic rates, rather than solely relying on Federal Reserve actions. There's an acknowledgment of a wide range of potential economic outcomes, with a goal to lower the rate to 2% over time, albeit recognizing it may take several years to achieve this target. Current projections show a gradual decline from a core PCE of 2.7% to 2.2% by the end of next year and finally reaching 2% by 2026. The concept of a 'soft landing' suggests willingness to extend the timeline for target achievement as concerns grow about making incorrect policy decisions.