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Zero interest-rate policy (ZIRP) is a macroeconomic concept describing conditions with a very low nominal interest rate, such as those in contemporary Japan and in the United States from December 2008 through December 2015 and again from March 2020 until March 2022 amid the COVID-19 pandemic.
A social optimum occurs when the nominal rate is zero (or deflation is at a rate equal to the real interest rate), so that the marginal social benefit and marginal social cost of holding money are equalized at zero. Thus, the Friedman rule is designed to remove an inefficiency, and by doing so, raise the mean of output.
The zero lower bound (ZLB) or zero nominal lower bound (ZNLB) is a macroeconomic problem that occurs when the short-term nominal interest rate is at or near zero, causing a liquidity trap and limiting the central bank's capacity to stimulate economic growth.
The Federal Reserve's policy of keeping interest rates super-low has a zippy acronym: ZIRP (Zero Interest Rate Policy). In his recent testimony to the House Financial Services Committee, Fed ...
Federal Reserve Chair Jerome Powell said Wednesday that the era of super low interest rates that occurred between the 2008 financial crisis and the pandemic is likely over and that the neutral ...
One possible reason is that they aren't expecting interest rates to come down significantly in the near future. "Few people seriously expect a return to ZIRP (zero interest rate policy). Indeed ...
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