Curse of negative interest rates: Central banks’ radical policy could trigger MAYHEM
CENTRAL banks are raising fears of another global financial crisis by slashing interest rates further below zero.
By LANA CLEMENTS
Express.co.uk
Tue, Apr 12, 2016
In the desperate hope of kick-starting growth, more banks in charge of developed economies are adopting the controversial policy.
Policymakers know they are walking a tight rope between giving the economy a boost and plunging banks into chaos by cutting interest rates.
But experts say the policy could have even more unwelcome side effects that could create economic mayhem.
It comes as amid scant evidence that negative rates have helped economies, raising the theory policymakers are making a bad situation worse and creating damage that is hard to undo.
The European Central Bank (ECB) last month dropped rates even lower to -0.4 per cent, following similar moves by the Bank of Japan, Sweden and Denmark.
Members of the Bank of England’s Monetary Policy Committee have also voiced the possibility of negative rates in Britain.
The Rest…HERE
