Fed seen holding rates at zero for five years in new policy
From Transport Topics. The Federal Reserve looks likely to keep short-term interest rates near zero for five years or possibly more after it adopts a new strategy for carrying out monetary policy. The new approach, which could be unveiled as soon as September, is likely to result in policymakers taking a more relaxed view toward…
From Transport Topics.
The Federal Reserve looks likely to keep short-term interest rates near zero for five years or possibly more after it adopts a new strategy for carrying out monetary policy.
The new approach, which could be unveiled as soon as September, is likely to result in policymakers taking a more relaxed view toward inflation, even to the point of welcoming a modest, temporary rise above their 2% target to make up for past shortfalls.
Fed Chairman Jerome Powell is slated to provide an update on the Fed’s 1-1/2-year-old framework review of its policies and practices when he speaks Aug. 27 to the central bank’s Jackson Hole conference, being held virtually this year because of the coronavirus pandemic.
“I wouldn’t be surprised if interest rates are still zero five years from now,” said Jason Furman, a former chief White House economist and now Harvard University professor.
Read the full post at Transport Topics online.