From January 2012, the month the US Fed adopted a 2.0% inflation target rate to September 2017, the annualized rate of PCEPI inflation has been 1.26%; the annualized rate of core inflation (PCEPILFE) has been 1.54%. McGuigan interprets this as a problem for the Fed; what drives inflation evades their grasp and they simply can’t get inflation back to target. It would seem more logical to believe that the US Fed set the target rate too high, and have switched to targeting something lower, possibly 1.5%, on a de facto basis. One of Powell’s first priorities if he takes over as Chairman should be to switch to a lower inflation target rate on a de jure basis. For more on this see my paper for the 2017 CEA meeting:
https://economics.ca//2017/papers/BA0017-1.pdf