Fed’s Williams Says Fiscal Policy May Have Raised Neutral Rate Slightly
The Federal Reserve Bank of New York President noted a 25 to 50 basis point increase in the neutral rate, while emphasizing the US remains in a low-rate environment globally.
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Terms & Concepts
Neutral rate: The interest rate level that neither stimulates nor restrains economic growth, often used by central banks as a policy benchmark.
Basis point: A unit equal to 0.01% used to describe changes in interest rates or yields.
Fiscal policy: Government measures involving spending, taxation, and borrowing to influence economic conditions.