The power of price stability

The economy has been expanding for the past few years, but concerns are growing over the pressures placed on it by fiscal deficits, current account imbalances, and energy shocks. Sandra Pianalto, president and CEO of the Federal Reserve Bank of Cleveland, explains why she thinks the Federal Reserve can best meet those challenges and promote economic prosperity by maintaining price stability. This Commentary contains the text of her remarks to the Levy Economics Institute of Bard College on April 21, 2005.