Economics
Fed Seen Holding Rates at Zero for Five Years in New Policy
- Fed expected to tolerate faster inflation, lower unemployment
- Powell to speak Thursday on long-awaited Fed framework review
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The Federal Reserve looks likely to keep short-term interest rates near zero for five years or possibly more after it adopts a new strategy for carrying out monetary policy.
The new approach, which could be unveiled as soon as next month, is likely to result in policy makers taking a more relaxed view toward inflation, even to the point of welcoming a modest, temporary rise above their 2% target to make up for past shortfalls.