As I noted, my FOMC colleagues and I generally anticipate that a rather gradual rise in the federal funds rate will be appropriate over the next few years, conditional on our baseline forecasts for real activity, inflation, and other aspects of the economy’s performance.
So far in my remarks, I have emphasized one key rationale for such a judgment – namely, that the equilibrium real federal funds rate is at present well below its historical average and is anticipated to rise only gradually over time as the various headwinds that have restrained the economic recovery continue to abate.