Fed's Brainard: In future recessions, could signal that rates at zero-level until inflation above target

Author: Adam Button | Category: Central Banks

Comments from Brainard

  • Could better time rate hikes after future recessions by committing to keep rates at zero until inflation is above target
  • Temporary price-level targeting approach could guard against premature liftoff, help keep inflation expectations anchored
  • Pre-crisis normal is not a good guide in new normal
  • Persistently low neutral rate has big implications

Brainard was responding to a Bernanke policy on price-level targeting and said her comments weren't intended to address the current stance.