Authors: Thomas M. Mertens and John C. Williams
-
-
Do you have a Freedom of Information request? Learn how to submit it.
See the world's largest accumulation of gold as you learn about the New York Fed and Federal Reserve System on a free tour.
The latest Annual Report chronicles the impact of Federal Reserve policies and includes data on the New York Fed's operations.
-
-
-
The Weekly Economic Index provides an informative signal of the state of the U.S. economy based on high-frequency data reported daily or weekly.
The Center for Microeconomic Data offers wide-ranging data and analysis on the finances and economic expectations of U.S. households.
Our model produces a "nowcast" of GDP growth, incorporating a wide range of macroeconomic data as it becomes available.
-
-
-
The Governance & Culture Reform hub is designed to foster discussion about corporate governance and the reform of culture and behavior in the financial services industry.
Need to file a report with the New York Fed? Here are all of the forms, instructions and other information related to regulatory and statistical reporting in one spot.
The New York Fed works to protect consumers as well as provides information and resources on how to avoid and report specific scams.
-
-
-
The New York Fed provides a wide range of payment services for financial institutions and the U.S. government.
The New York Fed offers the Central Banking Seminar and several specialized courses for central bankers and financial supervisors.
The New York Fed has been working with tri-party repo market participants to make changes to improve the resiliency of the market to financial stress.
-
-
-
The Economic Inequality & Equitable Growth hub is a collection of research, analysis and convenings to help better understand economic inequality.
This Economist Spotlight Series is created for middle school and high school students to spark curiosity and interest in economics as an area of study and a future career.
The Governance & Culture Reform hub is designed to foster discussion about corporate governance and the reform of culture and behavior in the financial services industry.
-
Staff Reports
Monetary Policy Frameworks and the Effective Lower Bound on Interest Rates
Number 877
January 2019 Revised July 2019
January 2019 Revised July 2019
JEL classification: E52
This paper applies a standard New Keynesian model to analyze the effects of monetary policy in the presence of a low natural rate of interest and a lower bound on interest rates. Under a standard inflation-targeting approach, inflation expectations will be anchored at a level below the inflation target, which in turn exacerbates the deleterious effects of the lower bound on the economy. Two key themes emerge from our analysis. First, the central bank can mitigate this problem of a downward bias in inflation expectations by following an average-inflation targeting framework that aims for above-target inflation during periods when policy is unconstrained. Second, a dynamic strategy such as price-level targeting that raises inflation expectations when inflation is low can both anchor expectations at the target level and potentially further reduce the effects of the lower bound on the economy.
AUTHOR DISCLOSURE STATEMENT(S)
Thomas M. Mertens
I declare that I have no relevant or material financial interests that relate to the research described in this paper.
John C. Williams
I declare that I have no relevant or material financial interests that relate to the research described in this paper.
I declare that I have no relevant or material financial interests that relate to the research described in this paper.
John C. Williams
I declare that I have no relevant or material financial interests that relate to the research described in this paper.
By continuing to use our site, you agree to our Terms of Use and Privacy Statement. You can learn more about how we use cookies by reviewing our Privacy Statement. 
