The Zero Lower Bound Remains a Medium‑Term Risk

Sophia Cho, Thomas Mertens and John Williams

No 20250707, Liberty Street Economics from Federal Reserve Bank of New York

Abstract: Interest rates have fluctuated significantly over time. After a period of high inflation in the late 1970s and early 1980s, interest rates entered a decline that lasted for nearly four decades. The federal funds rate—the primary tool for monetary policy in the United States—followed this trend, while also varying with cycles of economic recessions and expansions.

Keywords: zero lower bound (ZLB); ZLB; risk; Financial derivatives (search for similar items in EconPapers)
JEL-codes: E52 (search for similar items in EconPapers)
Date: 2025-07-07
New Economics Papers: this item is included in nep-his, nep-mac and nep-mon
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