Negative Rates

Not needed, not helpful

BLU PUTNAM, CHIEF ECONOMIST, CME GROUP

Negative rates are a central banking idea based on a poorly conceived and constructed linear view of the efficacy of monetary policy. They do not work to encourage either economic growth or inflation. And, it is very likely that over the next six to 12 months, as evidence of their failure grows, bankers at the European Central Bank (ECB) and Bank of Japan (BoJ) may try to find graceful ways to back away from negative rates, and instead embrace a view of linking monetary policy to more stimulative...

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