4  The natural rate and the neutral rate are closely related concepts whose technical differences matter for economic theory and estimation, but less for the intuitive discussion here. 4 See Brainard (2015). -3 The longer-run federal funds rate estimated by FOMC participants in their Summary of Economic Projections (SEP) meets the definition of a longer-run equilibrium rate of interest.
5 It is worth highlighting that the longer-run federal funds rate is the only neutral interest rate reported in the FOMC projections. But the shorterrun neutral rate, rather than the longer-run federal funds rate, is the relevant benchmark for assessing the near-term path of monetary policy in the presence of headwinds or tailwinds.