The Federal Reserve faces dilemma on its dual mission of employment and inflation

Benjamin Louvet, an analyst at Orfie Investment Asset Management, said in a report that the Fed may face difficulties on its dual mission of employment and inflation: Should interest rates be raised to deal with inflation, or should they be lowered to support economic growth and employment? He pointed out that raising interest rates cannot alleviate supply shocks without damaging economic growth, so it seems unlikely that the Fed will choose to raise interest rates. In addition, falling income in Gulf countries could weaken U.S. debt financing, forcing the Federal Reserve to cut interest rates and even resume bond purchases to support the economy.