Have international developments lowered the neutral rate?

Owen Humpage

Economic Commentary, 2005, issue Dec

Abstract: One way to think about monetary policy is in terms of a neutral federal funds rate, one that exerts neither inflationary nor deflationary pressures. Recent declines in worldwide investment, coupled with the growing globalization of financial markets suggest that the neutral rate may be lower than the current stance of monetary policy and the stage of the business cycle may lead one to believe.

Keywords: Federal funds rate; International finance; Monetary policy (search for similar items in EconPapers)
Date: 2005
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