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Sage Belz and David Wessel
What is Yield Curve Control?
Brookings Institution, 2019
What's inside?
The Federal Reserve may have a new monetary policy tool at its disposal.
Recommendation
Markets closely monitored the yield curve inversion of the two-year and 10-year US Treasury notes in August 2019, an event that often warns of an upcoming recession. In case of a downturn, Federal Reserve officials would deploy their usual policy toolkit – lowering interest rates, issuing forward-looking guidance and unleashing a fresh round of quantitative easing. But Brookings Institution professionals Sage Belz and David Wessel explore an alternative option: yield curve control. Executives, regulators and investors will find this a valuable assessment of a potentially new Fed approach.
Summary
About the Authors
David Wessel is a senior fellow at the Brookings Institution and director of the Hutchins Center on Fiscal and Monetary Policy, where Sage Belz is a research analyst.
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