Negative interest rates: Coming to America? – Yahoo Finance

By | February 20, 2015

Yet a collapse in interest rates overseas and the continuing risk of financial shocks is spurring Wall Street economists at least to mull the unlikely prospect of such a scenario developing here.

The specter of negative interest rates has been sweeping across Europe for months. The European Central Bank and those of Switzerland, Sweden and Denmark have set official overnight interest rates among banks below zero in an aggressive effort to encourage borrowing, energize economic growth and stave off deflation, a spiral in which people continually expect prices to fall.

As a result, some banks in Denmark are charging customers for the privilege of keeping their money in deposit accounts there.

Economists at Goldman Sachs Friday explored the possibility that, under unexpected and unwelcome circumstances, rates in the U.S. could slide below zero as well.

via Negative interest rates: Coming to America? – Yahoo Finance.