Federal Reserve vice chairman Donald Kohn said Friday that “temporarily” tolerating an “above-normal” rate of inflation as the economy recovers, as some macroeconomic theory suggests, would run the risk of undermining now-stable inflation expectations in a costly way.

Well-anchored inflation expectations have been crucial to the Fed’s ability to respond flexibly to the financial crisis and will help support the recovery, Kohn said. His implication seemed to be that the Fed will not keep monetary policy highly accommodative beyond the point at which wage-price pressures begin to appear.

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