Nominal interest rates may remain substantially below the averages of the last half century,
because central banks' inflation objectives lie below the average level of inflation, and …

Low and stable inflation requires an appropriate fiscal framework aimed at stabilizing
government debt. Historically, trend inflation is critically influenced by actual or perceived …

We study how changes in the value of the steady-state real interest rate affect the optimal
inflation target, both in the US and the euro area, using an estimated New Keynesian DSGE …

Since the 2001 recession, average core inflation has been below the Federal Reserve's 2%
target. This deflationary bias is a predictable consequence of a symmetric monetary policy …

The secular decline in the equilibrium real interest rate observed over the past decades has
materially limited the room for policy-rate reductions in recessions, and has led to a marked …

This paper develops a bivariate model of inflation and a survey‐based long‐run forecast of
inflation that allows for the estimation of the link between trend inflation and the long‐run …

Under conventional inflation targeting (IT), the lower bound on nominal interest rates gives
rise to a systematic downward bias in inflation that substantially reduces welfare. Using two …

It is conventional wisdom that the reduced form Phillips curve has become flatter in recent
decades. Accordingly, we show that the statistical relationship between changes in US …

When the policy rate is at the zero lower bound (ZLB), an increase in uncertainty regarding
the future path of exogenous shocks alters the conditional expectations of relevant prices …

I am delighted to be at the Cato Institute today to participate in your annual monetary
conference. The last time I had the privilege of speaking at this conference was in 2004. This …