There’s every reason to believe that we’ll fairly soon go back to an era of low interest rates

 Here’s a chart of the real interest rate — the interest rate minus the expected rate of inflation — on 10-year United States government bonds since the 1960s.

So, is the claim that the Fed was consistently setting interest below this natural rate? If so, where was the runaway inflation? 

In fact, until 2021, inflation consistently came in more or less at the Fed’s target of 2 percent a year.

But why was the natural rate so low? The immediate answer is the Fed learned from experience that it had to keep rates low to keep the economy from slipping into recession.

Since 2000, and especially since the global financial crisis, businesses have persistently been unwilling to maintain a level of investment spending that used all the money households wanted to save, unless interest rates were very low. This condition has the unfortunate name “secular stagnation”

What causes secular stagnation? The best guess is that it’s largely about demography.

Once inflation is back down to 2 to 3 percent, which will probably happen by the end of next year, the Fed will begin cutting again.

Paul Krugman NYT 21 June 2022

https://www.nytimes.com/2022/06/21/opinion/inflation-interest-rates-fed.html