The effective lower bound: some implications for inflation dynamics beyond the current low interest rate environment

Sebastian Schmidt

Research Bulletin, 2016, vol. 29

Abstract: The fact that there is an effective lower bound (ELB) on nominal interest rates makes it more difficult for central banks to achieve their inflation objectives with conventional policy tools. This is the case not only in the current environment where policy rates are at, or close to, the ELB, but also when the economy has recovered and policy rates have risen above the ELB. JEL Classification: E31, E32, E52, E58

Keywords: Deflationary Bias; Effective Lower Bound; Expectations; Monetary Policy; Risky Steady State (search for similar items in EconPapers)
Date: 2016-11
Note: 2179645
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Citations: View citations in EconPapers (6)

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