Finland’s GDP plummeted by as much as 8½%, which was considerably more than in 1991 – during the worst year of Finland’s previous economic crisis. The dive in aggregate demand in the global economy also affected prices, and in several countries inflation even slipped into negative territory for some time.
12 See Bernanke (2017) for a discussion of such a strategy. See Hebden and López-Salido (2018) for a quantitative assessment of that and other strategies. See also Kiley and Roberts (2017) for a strategy in which policymakers aim for inflation higher than 2 percent during economic expansions to compensate for below-target realizations of inflation during economic downturns. -7otherwise would be the case.