Will unconventional monetary policy be over anytime soon?
Yellen: No. It has become our norm.
Will interest rates go back to pre-crisis levels anytime soon?
Yellen: No. The world has changed.
Is the Fed raising rates?
Not quite. Since December 2015, long term rates are lower, not higher. (See Chart)
Is interest rate policy helpful for growth?
Yellen: It is not enough.
Today, Italian media published the news that prices in January were 0.6% lower than a year ago, calling such deflation a disease, a contagion. The fact that a component of deflation is the falling price of oil should be good news for an oil-importing country such as Italy. But no! National TV (RAI) insists that deflation is a nightmare, and other media wish for inflation to come back thanks to Draghi’s QE.