The Fed is 'held hostage' by data and risks sparking financial instability, Mohamed El-Erian says

• The Fed's over-dependence on data risks financial instability, Mohamed El-Erian wrote in a recent op-ed for Bloomberg.
• He says the central bank became too focused on inputs after misreading inflation in 2021.
• Holding interest rates up for too long risks a recession, he previously said.

The Federal Reserve's strict adherence to data is sapping it of policy alternatives, economist Mohamed El-Erian wrote for Bloomberg on Friday.