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Long-Term Interest Rates
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Long-Term Interest Rates

Remarks by Ben S. Bernanke, Chairman Board of Governors of the Federal Reserve System

Ben S. Bernanke
Federal Reserve Board, 2013
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Editorial Rating

8

Recommendation

In this key speech, Ben Bernanke, chairman of the Federal Reserve, summarizes the reasoning behind current policy on long-term interest rates, clarifying why a roll back now poses risks to growth and financial stability. Readers seeking a definite due date on the end of Fed easing and the arrival of higher interest rates may be disappointed. Nevertheless, getAbstract recommends his speech to all financial services professionals and investors seeking an increased understanding of the Fed’s current and future rates policy.

Take-Aways

  • The US and other developed economies keep interest rates low to encourage growth in the current period of economic adversity.
  • Many of the world's largest economies “cannot sustain significantly higher real rates of return,” so central banks must attempt to maintain low nominal long-term rates.
  • Over the next few years, long-term rates will stay low, but they will rise gradually when markets perceive that the Fed is ready to begin restraining its “accommodative” stance.

About the Author

Ben S. Bernanke is an economist and the chairman of the US Federal Reserve.

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