Globalization, technology and other forces have changed the way inflation works in the United States in a way that the Federal Reserve is still working to understand, Fed Chair Jerome Powell said on Monday.

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"Today's inflation dynamics are very different from even 25 years ago. Globalization and technology may be playing a role," Powell said in response to audience questions following a speech, citing the high cost of "brick" cellphones in the 1990s versus the price of a superior smartphone today. "This is not a new problem." Since setting a 2 percent inflation target in 2012 the Fed has struggled to meet it and has been surprised at how low inflation has remained despite falling unemployment.

First Published:May 21, 2019 6:36 AM IST