Banks resort to negative interest amid market collapse
The news of the day came from Federal Reserve Chairman Janet Yellen’s testimony before the Senate Banking Committee. Yellen admitted the Fed would not “take off the table” the possibility of joining the European Central Bank and the Bank of Japan in implementing negative interest rates in an attempt to reverse global selloff in global equity markets.
“We had previously considered them and decided that they would not work well to foster accommodation back in 2010,” Yellen told the Senate committee. “In light of the experience of European countries and others that have gone to negative rates, we’re taking a look at them again because we would want to be prepared in the event that we needed to add accommodation.”...