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Don’t do it again! The Swedish experience with negative central bank rates in 2015-2019

Andersson, Fredrik N G LU and Jonung, Lars LU (2020)
Abstract
Negative interest rates were once seen as impossible outside the realm of economic theory. However, recently several central banks have imposed such rates, with prominent economists supporting this move. This column investigates the actual effects of negative interest rates, taking evidence from the Swedish experience during 2015-2019. It is evident that the policy’s effect on the inflation rate was modest, and that it contributed to increased financial vulnerabilities. The lesson from the experiment is clear: Do not do it again.
Please use this url to cite or link to this publication:
author
and
organization
publishing date
type
Other contribution
publication status
published
subject
keywords
monetary policy, negative interest rates, Riksbank, Sweden
publisher
voxeu.org
language
English
LU publication?
yes
id
3b13e985-3dd3-420b-af41-42d72bd4814c
alternative location
https://voxeu.org/article/swedish-experience-negative-central-bank-rates
date added to LUP
2020-05-11 07:20:15
date last changed
2023-02-03 15:15:15
@misc{3b13e985-3dd3-420b-af41-42d72bd4814c,
  abstract     = {{Negative interest rates were once seen as impossible outside the realm of economic theory. However, recently several central banks have imposed such rates, with prominent economists supporting this move. This column investigates the actual effects of negative interest rates, taking evidence from the Swedish experience during 2015-2019. It is evident that the policy’s effect on the inflation rate was modest, and that it contributed to increased financial vulnerabilities. The lesson from the experiment is clear: Do not do it again.}},
  author       = {{Andersson, Fredrik N G and Jonung, Lars}},
  keywords     = {{monetary policy; negative interest rates; Riksbank; Sweden}},
  language     = {{eng}},
  month        = {{05}},
  publisher    = {{voxeu.org}},
  title        = {{Don’t do it again! The Swedish experience with negative central bank rates in 2015-2019}},
  url          = {{https://voxeu.org/article/swedish-experience-negative-central-bank-rates}},
  year         = {{2020}},
}