Forecasts of future real GDP growth from this extended model are higher than those from models that include only the slope of the yield curve. And the forecasts from this extended model currently are very close to the private-sector consensus forecast. Thus, we have reasons to believe that the current configuration of the term structure is not signaling an economic downturn.
At the same time, the amount of economic stimulus arising from low long-term rates is probably not especially large. Indeed, low long-term rates may be signaling relatively low demand for capital around the world relative to saving, which in turn may reflect a lack of sufficiently attractive investment opportunities.