Janet Yellen on the Swedish experience of policy tightening: “appreciable economic costs”

Chair Janet Yellen on the recent Swedish experience of Riksbank policy tightening, in a speech at the conference “The New Normal for Monetary Policy,” Federal Reserve Bank of San Francisco, March 27, 2015:

The experience of Japan over the past 20 years, and Sweden more recently, demonstrates that a tightening of policy when the equilibrium real rate remains low can result in appreciable economic costs, delaying the attainment of a central bank’s price stability objective.

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Discussion of Ajello, Laubach, López-Salido, and Nakata, “Financial stability and optimal interest-rate policy”

Discussion (slides) of the paper “Financial Stability and Optimal Interest-Rate Policy” by Andrea Ajello, Thomas Laubach, David López-Salido, and Taisuke Nakata, Federal Reserve Board, at the conference “The New Normal for Monetary Policy,” Federal Reserve Bank of San Francisco, March 27, 2015.

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