IMF Supports Move to Negative Rates by Some Central Banks

by David Chance
Yahoo! News

WASHINGTON (Reuters) – The International Monetary Fund said on Sunday that a move to negative rates by some of the world’s central banks would help deliver extra monetary stimulus and ease lending conditions.

Six of the world’s central banks have introduced negative rates, most notably the Bank of Japan and the European Central Bank, and around a quarter of the world economy by output is now experiencing official rates that are less than zero.

They have achieved this by cutting deposit rates into negative territory, ranging from minus five basis points in Hungary to minus 125 basis points in Sweden – essentially a “tax” on deposits.

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