The natural real interest rate in Denmark has declined

Analysis - June 2019 - No. 13

Authors Adolfsen, Jakob; Pedersen, Jesper
Subject Monetary policy; Monetary-policy transmission; Interest and exchange rates
Type Analysis
Year 2019
Published 27 June 2019
The natural real interest rate has declined since the 1990s. An important explanation is demographic trends in Denmark and abroad, which can be expected to continue in the coming years. Among other factors, lower natural interest rates have prompted central banks in several countries to apply unconventional monetary policies in order to stimulate the economy and increase inflation. Spillover effects from similar measures could affect the Danish economy in the future.