Economics
‘Poor Man’s Monetary Policy’ Lurks in a Low-Neutral Rate Future
- Across advanced economies, neutral rate settings have fallen
- A rash of recent research suggests that’s likely to persist
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Central bankers don’t change their minds overnight. In the case of neutral interest rates, it took Federal Reserve officials about 1,000 days.
That’s how much time passed between the June 2016 publication of "Measuring the Natural Rate of Interest: International Trends and Determinants” and the March 20 Federal Open Market Committee meeting -- two pivotal moments in post-crisis central banking.