“The ‘New Normal’ and What It Means for Monetary Policy,” speech delivered at the Chicago Council on Global Affairs, Chicago, September 12, https://www.federalreserve.gov/newsevents/speech/brainard20160912a.htm. -------- (2017). “Understanding the Disconnect between Employment and Inflation with a Low Neutral Rate,” speech delivered at the Economic Club of New York, New York, September 5, https://www.federalreserve.gov/newsevents/speech/brainard20170905a.htm. -------- (2018).
In the case of Japan, the upward pressure on long-term interest rates remains limited so far, since the BOJ’s massive purchases of JGBs have helped to generate stronger downward pressure on the interest rates with reduced risk premiums. Chart 6 shows the decomposition of key factors contributing to long-term JGB yields.