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Negative Interest Rates May Hurt European Central Bank

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Deutsche Bank's chief executive has warned of the "fatal consequences" of the European Central Bank's negative interest rate policy, which he said punished savers and could even undermine the recovery.

John Cryan said the ECB's decision to cut its deposit rate to a record low of -0.4pc and an escalation of its bond-buying programme were “working against the goals of strengthening the economy and making the European banking system safer.”

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Negative Interest Rates May Hurt European Central Bank

  1. 1. NEGATIVE INTEREST RATES MAY HURT EUROPEAN CENTRAL BANK Originally posted on telegraph.co.uk Created by: Manisha Dorawala
  2. 2. Deutsche Bank's chief executive has warned of the "fatal consequences" of the European Central Bank's negative interest rate policy, which he said punished savers and could even undermine the recovery.
  3. 3. John Cryan said the ECB's decision to cut its deposit rate to a record low of -0.4pc and an escalation of its bond- buying programme was “working against the goals of strengthening the economy and making the European banking system safer.”
  4. 4. In an article for German newspaper Handelsblatt, he said: “Monetary policy is thwarting goals to strengthen the economy and to make banks safer by now”.
  5. 5. While Mr Cryan praised the central bank for helping to revive the economy following the financial crisis, he said low rates had dire implications for savers and pension plans.
  6. 6. Mr. Cryan said the policies also encouraged companies to "refrain from investments due to ongoing uncertainty".
  7. 7. Larry Fink, the chairman of Blackrock, the world's largest asset manager, has also described the growing trend of negative interest rates as a “worrying”. He said the policy had "potentially dangerous financial and economic consequences" as investors take bigger risks to generate returns.
  8. 8. TO READ THE ENTIRE ARTICLE VISIT: ManishaDorawala.com

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