fightsy, the fmo c downturns by reducing the nominal federal funding rate, that is the rate charged by banks to lend to each other overnight. , current andons expected, stimulate spending and hiring by lowering longer-term, real interest rates -- that is, nominal rates adjusted for inflation. and by improving financial conditions more broadly. that the federal fund rate and other nominal interest rates cannot go much below zero. always ansh is alternative. can feasiblye fmoc push the real fund rate is essentially the negative value of the inflation rate. as a result, the federal reserve has less room to ease monetary policy when inflation is very low. is a potentially serious problem because severe downturns such as the great recession may require pushing real interest rates far below zero for an extended. riod of time to restore employment at a satisfactory pace. or this reason, pursuing tolerating persistently low inflation would be inconsistent with the other leg of the fmoc's mandate to promote employment. an unexpected decline in inflation is a sizable and persistent -- can also b