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Continued: AP Survey: Stock and bond markets caught off guard by Bernanke's timetable for higher rates

  • Article by: CHRISTOPHER S. RUGABER , AP Economics Writer
  • Last update: June 25, 2013 - 10:31 AM

The inflation gauge the Fed monitors most closely has risen only 1 percent in the past 12 months. That's well below the Fed's target rate of 2 percent. When inflation falls too low, the Fed normally keeps rates low to try to boost prices.

As a result, some economists surveyed by the AP faulted Bernanke for signaling a likely end to ultra-low rates.

"There is no evidence of inflation anywhere," said Dean Baker, co-director at the Center for Economic Policy and Research. "It is actually falling, not rising. ... This is definitely a wrong-headed move by the Fed."

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