Web Trader MT5
Normally you earn interest for lending money. Under a negative interest rate policy, you pay for the privilege. NIRP is the extraordinary step of pushing a central bank’s key rate below zero, so that commercial banks are effectively charged for parking excess reserves at the central bank rather than paid. The idea is to encourage money into motion, discouraging hoarding and encouraging banks to lend and households and businesses to spend, when even a zero rate has failed to revive a weak economy or lift inflation off the floor. Example: To fight the threat of deflation, the European Central Bank and the Bank of Japan both pushed their policy rates below zero in the 2010s, charging banks to hold reserves in the hope of encouraging credit out into the economy. Savers grumbled, bank profitability came under strain, and economists still argue about whether the unconventional policy measure actually worked as intended.
Disclaimer: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Start trading with A globally leading broker
Want to start trading?
We use cookies to understand how you use our website and to give you the best possible experience. You can find out more by viewing our Cookie Policy.
