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Does it refer to inflation or FED?

"Quite how far it is prepared to go will depend on what Yellen noted was an assessment of "the potential costs that could be associated" with a higher inflation target. Such assessment, however, probably will not be ready during her term, which ends in February 2018."

Source:https://www.reuters.com/article/us-usa-Fed-inflation-analysis-idUSKBN19630N

  • it can sometimes anticipate the noun (cataphora) but is most often anaphoric, referring back to an earlier noun. Using that general rule as a guide, you should always check to see if there's a candidate in the previous clause or sentence. Noun and pronoun need not be in the same sentence. – Tᴚoɯɐuo Jun 17 '17 at 11:34
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You need to look further back in the quotation:

At 4.3 percent, the jobless rate is at a 15-year low, yet wage growth is weak and inflation has recently slipped further away from the Fed's goal.

Quite how far it is prepared to go will depend on what Yellen noted was an assessment of "the potential costs that could be associated" with a higher inflation target.

There are three possible "its": inflation, the jobless rate, and the Fed.

The clue is that an abstract statistic like inflation or the jobless rate cannot really be said to be "prepared". The Fed, being an organization, can at least metaphorically make preparations. A knowledge of the purpose of the Fed (to control both inflation and unemployment by manipulation of the money supply) would also suggest that the sentence is talking about that agency.

But the fact that the reader must do this level of analysis to resolve a pronoun is a sign of very bad writing.

  • 2 answers, 2 different results. I'm more confused :-) – haile Jun 17 '17 at 5:40
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    @haile The pronoun it refers only to the Federal Reserve Bank. – P. E. Dant Jun 17 '17 at 6:32
  • +1 for the comment about "making preparations". Not understanding prepared to go is what led to OP's doubt. – Tᴚoɯɐuo Jun 17 '17 at 12:51

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