6 That means that, if we continue to target a 2 per cent inflation rate, it’s more likely that policy interest rates will fall to zero than in the past. Remember, only a few years ago, many believed zero was where monetary policy was out of bullets. We now observe that some European countries have tested this limit.
There, central banks are charging commercial banks for their deposits, and governments are effectively getting paid to borrow. We published today an interesting staff paper that looks at the  3  L. Benati and P. Surico, “VAR Analysis and the Great Moderation,” American Economic Review 99, no. 4 (2009):1636–52.