3:51 p.m. ET, March 17, 2021
Is the Fed prepared to live with lower interest rates?
From CNN Business' Bridget O'Brian
Before the pandemic, the Federal Reserve was focused on whether interest rates were too low. Have its views changed?
"We're committed to giving the economy the support it needs, as quickly as possible, until it returns to maximum employment and price stability," said Fed chair Jerome Powell.
"To the extent that raises other questions, we think it’s absolutely essential to maintain the strength and stability of the financial system," he added.
He pointed to the longest economic expansion in US history, which lasted 10 years and eight months until the pandemic cut it short. Rates remained at zero for 7 of those years, and they never went above 2.4% during the period of expansion.
"During that time the US didn’t see excess build-up of debt or a housing bubble," he said. "That doesn’t mean we are ignoring these possibilities."
One reason for the expansion was the low-rate environment, he said. While he acknowledged there is "a connection between low rates and financial instability," he noted that "it's not quite so clear."