Page 6 of 11  The mix of subdued demand growth, low inflation and low interest rates is keeping alive talk of ‘secular stagnation’, although economists disagree on whether this is a temporary phenomenon linked to post-crisis adjustments or a more permanent one. It is, however, important to take into account the differences between countries and be wary of ‘one size fits all’ recommendations.
In other words, we do not intend to use the balance sheet as an active tool for monetary policy in normal times. However, the Committee would be prepared to resume reinvestments if a material deterioration in the economic outlook were to warrant a sizable reduction in the federal funds rate.