>Inflation is tricky and dangerous:
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>1. Western governments require inflation so they can pay off debts in devalued currency. Nothing gets a government's attention faster than any threat of sustained deflation
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>2. The level of inflation is a confidence game. If the target is arbitrarily raised a lot, prices will have to follow suit immediately. Actual prices could overshoot and you could end up with unmanaged 10 - 15% such as we had in Canada in the early '80s. I'd like to think larger countries/currencies could avoid runs on their currencies and avoid a Weimar Republic/Venezuela situation - extreme or hyper-inflation
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>3. High(ish) inflation disproportionately affects seniors and others on low/fixed incomes. Those cohorts tend to vote a lot; governments would rather keep them happy. Inflation-indexing benefits doesn't really work; in Canada (at least) I can't recall ever seeing a government program where the inflation-indexed increase actually kept pace with real inflation rates (benefits, income tax exemption limits etc.). In Canada at least, the federal government uses things like income tax exemption limits, tax brackets etc. to slowly and nearly invisibly increase taxes
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>Here in Canada the BoC's stated inflation goal is 2% p.a. nominal, with a range of 1 - 3% tolerated. It's been that way for many years and the BoC has built a lot of confidence and trust in that number. The savings frogs are boiled very slowly but federal actuaries can see light at the end of the debt/deficit tunnel. If the BoC throws that target away we're looking at 1981 again, and few in Canada want that.

Agree with what you say.

What is the mandate of the BoC? Is it stable prices (which is the mandate of the US Fed)? But inflating prices is not stable prices. US dollar has lost 93% of its purchasing power in the last 100 years. That is our governments working for our benefit. It's the inivisble tax.