Investing.com - Normally with an enormous tax cut package on the way, U.S. Federal Reserve policymakers would be expecting a spike in inflation.
But given the unusual behavior of inflation since the Great Recession of 2009, normal may not be the case.
Despite years of economic growth, the Fed's preferred inflation gauge has yet to reach the central bank's target level of 2%. At its worst in 2017, inflation rose at a 1.8% annual rate.
Nevertheless, the central bank has raised interest rates on a steady basis since the end of 2015.
Recent indications show some Fed officials remain worried about stubbornly low inflation. That suggests a more cautious approach to additional rate hikes.
Others are concerned about an already solid economy overheating because of the fiscal stimulus of the $1.5 trillion dollar tax package. That suggests a more aggressive approach.
The tax package may complicate an already difficult balancing act.