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15 Jan 2015
War of Negative Rates to Intensify - SNB
FXStreet (Guatemala) - Analysts at TD Securities explained that the SNB has now set the new low bar for a negative policy rate at -75bps.
Key Quotes:
"There is nothing to stop them from taking this further, nor extending it more broadly across domestic savers. But the ECB’s –20bps deposit rate, the Riksbank’s 0% repo rate, and certainly the Norges Bank’s rich yield feast of 1.25% all start to look like potential avenues to ease further".
"This is the driver for the broad-based underperformance of all the European crosses, DKK included, on the day. Rate cuts are back in vogue and the zero lower bound is much less binding".
Key Quotes:
"There is nothing to stop them from taking this further, nor extending it more broadly across domestic savers. But the ECB’s –20bps deposit rate, the Riksbank’s 0% repo rate, and certainly the Norges Bank’s rich yield feast of 1.25% all start to look like potential avenues to ease further".
"This is the driver for the broad-based underperformance of all the European crosses, DKK included, on the day. Rate cuts are back in vogue and the zero lower bound is much less binding".