The shift in attitude is understandable. Fed officials are nervous about financial risks associated with asset purchases and a prolonged period of low rates. But it is nonetheless unfortunate. Inflation is entirely subdued; price increases are running below 2% and have been slowing further in recent months. Meanwhile, unemployment is well above the level the Fed associates with full employment, and the number of Americans working is still over 2m jobs shy of the pre-crisis level. Strong gains in labour-force participation in recent months suggest that it may take a faster pace of job creation to sustain the downward trend in the unemployment rate, and even that trend puts off a return to sub-6% unemployment into 2015. America is desperately in need of an acceleration in hiring. But 178,000 jobs per month seems to be the Fed's good-enough-rate, at which the risks from unconventional policy, real or imagined, justify a less aggressive stance. It is hard to see the logic in that; there are few things more damaging to an economy than a prolonged period of high unemployment. But there is no sign that policymakers are interested in any other path.
