Long Term Perspective
The real (inflation-adjusted) rate of interest indicates the degree of constraint in the financial market. In this case, the federal funds rate (controlled by the Fed) is compared to the yearly change in the PCE (personal consumption expenditure) deflator. When the PCE deflator and the fed funds rate were equal in 1992, it signaled an accommodative policy stance. As the gap widened in the 1990s, it meant that monetary policy grew more restrictive. This is not unusual during an economic expansion. The gap narrowed in 2001 as the Fed eased aggressively in order to spur economic activity.

Short Term Perspective
The FOMC left the federal funds rate target unchanged at 1 percent at the October meeting. Their post-FOMC statement implied that they don't intend to change monetary policy over the next several months.