The Great Moderation in the volatility of GDP growth and price inflation, which began in the 1980s, came to an abrupt end with the onset of the financial crisis in 2008 but, a decade later, what stands out again is just how stable economic growth and price pressures have been. Last year the 10-year standard deviations of both GDP growth and core PCE inflation dropped to record lows. The current expansion is already the longest on record and, with recent fears of an imminent recession fading, is it possible that boom and bust is a thing of the past?
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