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Yahoo Finance

The Fed's biggest challenge has become the 'Sasquatch of the financial world'

Yahoo Finance
Summary
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81% Informative

The neutral rate is the interest rate that neither stimulates nor slows the economy.

Too low, and the economy might overheat; too high, and growth stalls.

A higher neutral rate implies the Fed doesn't need to cut rates as much to support the economy as it does with inflation.