ECB Doesn’t Know How to Get Out of Negative Rates, AXA's Page Says

The video discusses the structural feature of negative deposit rates in the Eurozone and their potential impact on the banking system. It explores the concept of reversal rates, which can harm banks if rates become too negative. The ECB faces challenges in adjusting these rates without signaling tightening, especially with low inflation and growth. The global economic context, including fiscal stimulus and inflation expectations, also influences central bank policies.

What is a potential consequence of reaching the reversal rate level in the Eurozone?

• Damage to the banking system

• Higher inflation rates

• Strengthened banking confidence

• Increased lending by banks

What was the ECB's hope regarding global growth and negative rates?

• That it would justify further negative rates

• That it would make negative rates more effective

• That it would have no impact on negative rates

• That it would allow for a quick removal of negative rates

Why is the ECB considering a tiered structure for negative rates?

• To simplify monetary policy

• To eliminate negative rates entirely

• To mitigate damage to the banking system

• To increase the negative impact on banks

What is a major concern for central banks regarding inflation expectations?

• That they are becoming negative

• That they are irrelevant

• That they are stabilizing

• That they are rising too quickly

How does the US differ from Europe in terms of fiscal policy response?

• The US has implemented a large fiscal stimulus

• The US has reduced fiscal stimulus

• The US follows Europe's fiscal policy

• The US has no fiscal policy