Do severe recessions associated with financial crises cause permanent reductions in potential GDP, or does the economy return to its trend? If the economy eventually returns to its trend, does the return take longer than the return following recessions not associated with financial crises? We...

The Federal Open Market Committee’s revised Statement on Longer-Run Goals and Monetary Policy Strategy implements flexible average inflation targeting and mitigates shortfalls, rather than deviations, of employment from its maximum level. We first show how the Taylor, balanced approach, and...

The Federal Open Market Committee raised the target range for the federal funds rate above the Effective Lower Bound in March 2022 for the first time since March 2020 and projected six more rate increases in 2022. The Committee’s actions follow the August 2020 revised Statement on Longer-Run...