Think your bank has a good interest rate? Think again! A new raft of measures by the European Central Bank includes a never-before-seen negative interest rate, in an effort to incentivize loaning to businesses.
ECB introduces negative interest rates | Business
The ECB has introduced a negative deposit rate for the first time, in response to a slowdown in inflation
The following excerpt comes from BBC News
The ECB is the first major central bank to introduce negative interest rates.
Howard Archer, chief UK and European economist at IHS Global Insight said: "Despite being widely anticipated and in some quarters criticised for occurring too late, it is still a bold and unusual move by the ECB to take its deposit rate into negative territory."
"There has to be considerable uncertainty as to how effective negative deposit rates will turn out to be," he added.
Bloomberg Business News focuses on the strategy of the move.
“Draghi’s gone all-in today,” Owen Callan, an analyst at Danske Bank (DANSKE:DC) in Dublin, told Bloomberg News. “Don’t think of this as a bazooka. This is more like a fleet of killer drones to target deflation from all angles.”
The official Twitter account of the @ECB has a link to the full transcript for those who are so inclined.