Interest Rate Cuts
J. Bradford DeLong
- The 4.5 percentage-point reduction in the target Federal Funds rate by the Federal Reserve over the past year is an astonishingly large shift in monetary policy.
- Yet it is not clear it will be enough to avoid a deep recession.
- And there is not that much more room left for further monetary expansion.
- The Bank of England has cut interest rates by only half as much as the Federal Reserve.
- The European Central Bank has cut interest rates by only one-third as much as the Federal Reserve.
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