Allianz sees 10 more years of low interest rates
Monday, 01 18 2016, Category: Insurance and Reinsurance, Country: Europe
Euro area interest rates are likely to stay at current lows for up to 10 more years, with negative effects of the European Central Bank's policy beginning to outweigh the positive, the chief executive of Europe's biggest insurer, Allianz, said in an interview.
"The goal of this (ECB) policy is to get banks to lend more but that isn't happening," Oliver Baete told Der Spiegel magazine in the interview released on Friday.
"However, we expect interest rates to stay at this ultra-low level for a further eight to 10 years," Baete said.
Low interest rates and central bank money printing programmes known as quantitative easing have distorted asset prices and slashed the income insurers can earn from investments, the bulk of which is in bonds.