Great Recession saw largest economic decline but smallest conventional monetary policy response of last four recessions: Change in inflation-adjusted federal funds rate and cumulative output gaps, various recessions
| Time | Real federal funds rate (FFR) change | Cumulative output gap |
|---|---|---|
| Early 1980s | -6.14% | -15.82% |
| Early 1990s | -5.27% | -11.53% |
| Early 2000s | -5.62% | -7.38% |
| Great Recession | -5.20% | -18.63% |
Notes: The change in the real federal funds rate measures from one year before the business cycle peak to two years after the recession’s trough. The cumulative output gap measures the sum of the differences between actual and potential gross domestic product (GDP) from the recession’s beginning to one year after its official end. The real federal funds rate is constructed as described in Figure A.
Source: Output gap measured from Table 1.6 from BEA NIPA tables and data on potential GDP from Congressional Budget Office (2017)