Core Viewpoint - The Federal Reserve's meeting minutes indicate that the benefits of the flexible average inflation targeting framework have diminished in a high-risk environment, prompting a reconsideration of the strategy [1] Group 1: Inflation Targeting Framework - Participants discussed the pros and cons of flexible average inflation targeting and flexible inflation targeting [1] - Under flexible average inflation targeting, monetary policy aims to compensate for periods of inflation below the target to achieve a 2% average inflation rate [1] - In contrast, flexible inflation targeting seeks to restore the inflation rate to 2% without compensating for previous deviations from the target [1] Group 2: Economic Environment Considerations - Participants noted that the risks associated with the effective lower bound (ELB) of policy rates are more pronounced when inflation remains persistently below target [1] - The flexible average inflation targeting framework may help limit the downward risk to long-term inflation expectations in such scenarios [1] - However, the benefits of this framework have weakened in environments with high inflation shock risks or when the risk of hitting the effective lower bound is low [1] Group 3: Policy Strategy Reevaluation - There is a consensus among participants on the need to reconsider the wording in the "Statement on Longer-Run Goals and Monetary Policy Strategy" regarding average inflation targeting [1] - An effective monetary policy strategy must be adaptable to various economic conditions [1] - Participants believe that a flexible inflation targeting strategy is a more robust policy approach to address persistent deviations from the committee's 2% long-term inflation target [1]