Tuesday, March 3, 2015

How Low Can Rates Go?

With companies holding record amounts of cash, banks may be reporting record earnings as the Commonwealth Bank of Australia estimates that about one quarter of bank deposits worldwide are earning negative interest rates. Switzerland and Denmark lead the pack, with savings account rates of negative .75 percent. Previously, zero percent was seen as the lower bound for savings rates, but some analysts argue that the new lower bound is considerably lower than negative .75 percent.