Martin Wolf at his best: Monetary policy in a low-rate world

Ever since the financial crisis, central banks have done unusual and unpopular things. In unusual circumstances, that was inevitable.

Unfortunately, the unusual circumstances now appear to be usual. 

Monetary policy cannot set the real interest rates over the long run. 

Indeed, monetary policy actions may not have much impact on these even in the short run. 

Premature rises in interest rates might trigger a sharper slowdown than people expect

Martin Wolf, FT 13 Sepptember 2016


See also: Conundrum - Secular Stagnation - Asset price bubbles and Central Bank Policy