Sometimes doing nothing really is better than doing something. On September 17th the Federal Reserve made the right decision to leave its benchmark interest rate, unchanged since 2008, near zero. With inflation sitting well below the Fed's 2% target and doubts about China's economy prevalent (see page 71), a rise would have been an unnecessary risk. Yet Janet Yellen, chair of the Fed, will face a similarly tough choice in October-and possibly for many months thereafter. And whenever "lift-off" occurs, financial markets expect rates to stay historically low for years to come. The era of unconventional monetary conditions shows no sign of ending. If the rich world's central banks are to get back to the normality they crave, their standard toolkit may not suffice. It is time to think more boldly, especially about the idea of inflation targeting.
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