Sentences with phrase «nominal rates below»

However, when financial repression produces negative real interest rates (nominal rates below the inflation rate), it reduces or liquidates existing debts and becomes the equivalent of a tax — a transfer from creditors (savers) to borrowers, including the government.»

Not exact matches

By secular reflation, we mean at least a decade in which short - and long - term interest rates stay habitually below nominal GDP growth and high grade bonds are not really bonds any more: delivering trend returns that are close to zero or even negative.

Low inflation and the impossibility of pushing nominal interest rates significantly below zero meant that there was little scope for lowering real interest rates and easing credit conditions by conventional means.

But regardless of the debate, the point to remember is that when the nominal lending rate is much below the nominal GDP growth rate, two very important things happen.

Their studies suggested that among developing countries nominal lending rates had on average been around two - thirds on nominal GDP growth rates (although China, at around one - third, was still well below anyone else's at the time).

It is only when credit growth begins to decelerate much more rapidly than nominal GDP growth that we can begin to talk hopefully about China's moving in the right direction, and it is only when credit growth falls permanently below the growth rate of the economy's debt - servicing capacity that China will have adjusted.

In the 2006 Budget, the government promised to reduce the deficit by $ 3 billion per year; to reduce the federal debt - to - GDP ratio to 25 per cent by 2012 - 13; to eliminate the total government sector debt (which includes the federal, provincial and local governments as well as the Canada and Quebec pension plans) by 2021; and finally, to keep the growth in program expenses below the rate of growth in nominal GDP.

But in the current situation, where nominal interest rates are constrained because they can't go below zero, a small increase in expected inflation could be helpful.

The U.S. economy has never been willing to hold more than 10 cents of base money per dollar of nominal GDP except when interest rates were substantially below 2 %.

During this period, a smoothed average of nominal growth explains almost 60 % of the variation in long - term rates (see the chart below).

If she had added: «Plus, even though we are currently above the Effective Lower Bound on nominal interest rates (which is probably below 0 %) we are worried that the margin of safety is getting a bit small, and are pleased that fiscal policy is making that margin of safety a bit bigger than it otherwise would be» that would also be an internally consistent thing for the Bank of Canada to say.

Nominal means very small or far below the real value or cost, and in finance, this adjective modifies words such as fee, interest rate and gross domestic product (GDP).

In contrast, real interest rates can be negative, when nominal interest rates are below inflation.

We shared these rates with Riot in the hope of reaching an agreement commensurate with the market but, while they offered a nominal increase, their deal remained far below industry standard for 2016 ″ — OGN Casters

However, this needs to be seen in the context of property prices growing by 3.5 to 5 % in nominal terms, which is below the current rate of inflation.