2% was the target over the long haul (not 3%) -- BUT it is a dual mandate to keep unemployment to a minimum as well. This is considered on the high end of that part of the inflation mandate, and as another comment stated -- if it is persistent, it will be seen as a negative.
Compared to the past 12-24 months, 2.9% doesn't seem to be particularly worse than previous months. E.g. it was even higher at 3% at the beginning of the year and it has been at 2.7% for the past few months.
Might not be at the 2% target, but at least looking at the graph, 2.9% isn't making me panic. Maybe the panic is warranted, I don't know.
Edit: Although maybe it does get more worrying if the hypothesis is that reducing rates will result in upward pressure on inflation. That could be worrisome.
Oh, it's definitely not, and panic is definitely not called for.
I think that's why they feel they have the leeway to lower interest rates to combat weaker job numbers. I think the concern is that we'll paint ourselves into a corner and end up with interest rates persistently at double (or worse) the target.
Was under the impression that 2-3% is the target. Less than that is bad. More than that, also bad.