Negative interest rates?

Discussion in 'Markets & Economies' started by stackmans, Mar 19, 2020.

  1. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Apparently the cash rate and bond markets are meant to "function" in a manner that "constrains" interest rate volatility.

    The bond market is also a nice little gravy train for banks. :p
     
  2. hardyakkagold

    hardyakkagold Well-Known Member

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    Why does that ignored haemorrhoid keep following me around?
    I think shiney is in love with me;)
     
  3. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Nah it’s just that you say stupid things. So I was laughing.
     
  4. bubblebobble2

    bubblebobble2 Well-Known Member Silver Stacker

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    ^^^^
    come’on guys...can’t you just kiss ‘n make up!?
     
  5. BuggedOut

    BuggedOut Well-Known Member Silver Stacker

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    No.

    Shiney likes the verbal joust too much and the other guy doesn't seem smart enough to know any better.

    Just consider it noise. Thread pollution. Put them both on ignore if their tedium bothers you.
     
    mmm....shiney! likes this.
  6. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Hmmm, I thought I read somewhere that analysts were predicting that the RBNZ would get to sub-zero rates at some time. Didn't even get a rate cut.

    snip

    snip


    https://invezz.com/news/2020/11/11/nzd-usd-spikes-to-0-6900-after-the-rbnz-interest-rate-decision/


    The RBNZ is downbeat about the future, expecting downside risk to pose a greater threat than the potential for any welcome upside risk.

    This video, at 12:08 they discuss negative rates. First a bit of theory ie it's supposed to be a disincentive against banks from holding cash settlement balances (the RBA has now set a 0% rate for Exchange Settlement balances, previously they'd lifted it to 0.1%), then what it's supposed to do ie reduce the rates for borrowers as banks used the cash settlement balances more aggressively and in the process benefit borrowers.

    The RBNZ Chief Economist made it clear that depositors and mortgage holders won't face negative rates, at 14:07:

     

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