Measuring the natural rate of interest
I use data from 1987 through the third quarter of 2015 to estimate the natural rate since the most recent
recession and then project it through 2020, shown in Figure 1. The blue line is the median percent
estimate at an annual rate. The shaded
areas represent the 70% (darker) and
90% (lighter) probability ranges of
possible estimates. The vertical gray bar
shows the Great Recession according to
the National Bureau of Economic