Yellen Speech May Touch on Falling Long-Run Rate Outlook: Chartby
That so-called neutral rate? There’s a good chance Federal Reserve Chair Janet Yellen could discuss it in her speech Friday in Jackson Hole, Wyoming. It involves the notion -- supported by policy makers’ steady downgrades of how high they see the Fed funds rate rising over the long haul -- that borrowing costs could hold at a lower level than had been historically normal. And in terms of monetary policy over the longer term, it would mean hitting the lower bound on interest rates and resorting to extraordinary tools more often.