-8lower than that today and will only return to its longer-run value over time. 12 One important implication is that today’s low rates are not as stimulative as they may seem-consider that, despite historically low rates, inflation has run consistently below target. Monetary Policy amid Uncertainty I’d like to turn now to monetary policy.
I expect the economy to continue broadly along its current path, which implies further labor market tightening and inflation edging closer to 2 percent. On this path, unemployment would decline modestly below current estimates of the natural rate and remain there for some time. I see that as a desirable outcome and do not see data suggesting that we are behind the curve.