Progress and background of negative interest rate
More and more economies may fall into a negative interest rate environment. In July 2009, in order to hedge the declining economy and inflation, the Swedish central bank lowered the overnight deposit interest rate to -0.25%, becoming the first central bank in history to reduce the policy interest rate to a negative value. Since then, Denmark and Switzerland have entered negative interest rates at 20 12 and 20 14 respectively. The euro zone and Japan also lowered their benchmark interest rates below 0 on 20 14 and 20 16 respectively. Since 2020, affected by the COVID-19 epidemic, the global economy has fallen into recession, major economies have accelerated into a loose cycle, and policy interest rates have been declining. After the United States cut interest rates sharply twice in a row, the target interest rate of the federal funds has dropped to the lowest level in history of 0.25%. In addition, it is 0. 1% in Britain, 0.25% in Canada, 0.23% in Australia and 0.75% in South Korea, which is only one step away from negative interest rates. Europe, Japan and other economies that have not yet normalized their monetary policies are getting deeper and deeper in the quagmire of negative interest rates. As the global economic recession intensifies, more countries may fall into a zero or negative interest rate environment in the future.