Search results for "unconventional monetary policy instruments"

Remarks on negative interest rates

2016

Negative nominal interest rates have been observed in several segments of financial markets. Being only partly a result of supply and demand and mainly enforced by the central banks, negative interest rates are getting more and more popular. While it is relatively easy to identify the reasons for this quite strange phenomenon, the con-sequences, especially the long-term consequences, are not too clear for both scientists and ordinary observers. This paper is an attempt to formulate some remarks on causes, evidence, and possible effects of negative interest rates. A warning is issued, with respect to monetary policy and financial stability.