Negative Interest Rates Described as ‘Dirt’ for Insurers
Friday, 07 15 2016, Category: Insurance and Reinsurance, Country: Europe
Central bankers globally need to realize the risks that extreme monetary policies will backfire, according to Voya Financial Inc.’s Karyn Cavanaugh.
“Negative rates are turning out to be a dirt sandwich, especially for Japan,” Cavanaugh, who works as senior market strategist at the insurer’s asset manager, said Wednesday in an interview at Bloomberg headquarters in New York. “They thought that that was going to get people out spending. And what happened is they got people to go and buy safes and put money into their safes and hoard money.”
Policymakers from Japan and the European Central Bank have sought to stoke economic growth by implementing negative interest rates.
Source: Insurance Journal