The yield curve in 2009 was very low, with short-term rates close to z

The yield curve in 2009 was very low, with short-term rates close to zero and long-term rates below 5 percent.
What factors contributed to such low interest rates?

What will be an ideal response?

ANSWER

In response to the banking and economic crises, the U.S. Government undertook policies to reduce interest
rates in an attempt to stimulate economic activity. In addition, the recession caused a decrease in the demand for
borrowed funds, and investors, scared off by large declines in the stock market, moved money into safer U.S. Treasury
securities. Increasing Treasury prices mean lower yields.