Negative Policy Rates Seem To Be Working For Now: Capital Economics

The introduction of negative policy rates by four European central banks over the past year has helped to trim longer-term interest rates and to stem the upward pressure on some currencies, notes Capital Economics.

Respected macro research firm, Capital Economics in its June 25, 2015 report titled: “Are negative policy rates here to stay?” notes despite looming Fed tightening, the global easing cycle is not over yet.

Drop in average interest rates

The report points out that during the past twelve months, the ECB, the Swiss National Bank, the Danish National Bank and the Swedish Riksbank have all cut policy rates below zero.

Interbank interest rates in...