The European Central Bank (ECB) announced several measures to inject life into the Euro zone stagnant economy. One such measure is the decision to cut the deposit rate for the region’s commercial banks from zero to minus 0.1 per cent. This is something unusual and has never been heard before. Although the measure brings expectations, it also brings much fear along with it. With the entire Eurozone in economic trouble, ECB’s measure is being seen as a gamble. Everyone is watching what the impact of this policy will be? Will it bolster the economy and move it forward or will it hit hard and push it back towards uncertainty? Negative interest rate was present in Nordic countries a few decades ago with minimal effect on expected results. What will happen to Europe, and this policy weather is the best that ECB needs to be consider is for us to see?

Keywords: European Central Bank, Negative interest rate, Euro zone economy

Suggested citation: Das,D.(2014). Negative Interest Rate Policy by ECB: A Case Study. Skyline Business Journal, Volime 10, Issue 1,pp 49-55.

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