Rare disasters, the natural interest rate and monetary policy | NEP-DGE Blog
Rare disasters, the natural interest rate and monetary policy | NEP-DGE Blog
I mentioned several times on this blog that demographic aging is a source of declining interest rates. Now add climate change to the mix. As it looks like declining fertility may also come from climate change, the two shocks may reinforce each other in reducing interest rates. After a decade or two with interest rates kept low by policy, they may not be increasing that much once we get back to “normalȁ times.