Bloomberg Opinion columnist Daniel Moss argues that central banks should overhaul their inflation targets rather than abandon them, as economic shocks grow more frequent and severe. His call comes as US price data still runs above the Federal Reserve's 2% goal, with gold drawing renewed interest as a hedge.
Daniel Moss, a veteran Bloomberg Opinion columnist writing from Singapore, says the inflation-targeting framework central banks have used for decades is under more strain than at any point since it became the global standard. In an August 2026 column titled "Ditch Inflation Targets? Better to Overhaul Them Instead," he argues the world has entered an era of more frequent and severe disruptions, from geopolitical conflicts to supply-chain fractures to energy-price volatility.
Reform, not retreat
Moss pushes back against calls to scrap inflation targeting altogether. He notes that inflation-targeting regimes have expanded steadily since the late 20th century and have shown resilience even when critics called them outdated. His position sits in the middle: keep the targets, but let them evolve, through wider bands, longer time horizons, or explicit acknowledgment that some pressures lie beyond a central bank's control.
Where the pressure is showing
Moss points to the Philippines as a case where inflation episodes have exposed how vulnerable emerging markets are to external food and energy shocks. Rising interest-rate shocks are another recurring theme in his work: when central banks hike rates aggressively to fight inflation, the higher borrowing costs ripple through housing markets, corporate balance sheets, and government debt burdens.
US inflation still running hot
Moss's warning lands against a backdrop of US consumer prices rising 3.4% year-over-year in July, with core CPI at 2.5%, both above the Federal Reserve's 2% target. That reading eased only slightly from June's 3.5% pace. Energy prices alone rose 14.7% over the year.
Pricing in gold markets suggests Moss's warning may be impacting investor sentiment, with participants increasingly focused on gold as a potential safe haven. Market odds currently put a 7% chance that gold hits $4,700 in August.
An Asian central bank widening its inflation tolerance band while the Federal Reserve holds a tighter framework would create meaningful pressure on exchange rates, Moss argues.
Sources: Crypto Briefing, Crypto Briefing
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