Zero interest rate policy
From Wikipedia, the free encyclopedia
The zero interest rate policy (ZIRP) is a Keynesian macroeconomics scheme for economies exhibiting slow growth with a very low interest rate, such as contemporary Japan and since, December 16, 2008, the United States.
Under ZIRP, the central bank maintains a 0% nominal interest rate. The intended effect of a ZIRP is to encourage investment throughout the economy by making capital purchases more financially attractive. Whether ZIRP succeeds in achieving this goal is a matter of much debate.
[edit] See also
- History of Federal Open Market Committee actions
- Federal funds rate
- Liquidity trap
- Real interest rate
- Stagflation
[edit] Further reading
- Eggertsson, Gauti B.; Woodford, Michael (2003). "The Zero Bound on Interest Rates and Optimal Monetary Policy". Brookings Papers on Economic Activity 2003 (1): 139–211. http://www.jstor.org/pss/1209148.
[edit] External links
- A Rate of Zero Percent From the Fed? Some Analysts Say It Could Be Coming
- Monetary Policy Alternatives at the Zero Bound: An Empirical Assessment
- Fed Funds Rate: Turning Japanese, I Really Think So
- Nominal Interest Rates: Less Than Zero?
- Bank-of-Japan gives away money interest-free
- Rising Islamic bankers face surprise challenge from Fed
- Hopes for the Future of Islamic Finance

