Here we go and for the first time in history we witnes central bankers gone mad. While it is true that real (inflation adjusted) interest rates have been negative for a while now, this time even a nominal value is in negative territory therefore out in open view of even a common sheeple.
Following the ECB’s 25bp rate cut, the [Danish central bank] yesterday cut the lending rate, discount rate and CD rate by 25bp. The new rates are 0.2% for the lending rate, zero for the discount rate, and minus 0.2% for the CD rate. The [Danish central bank] raised the ceiling for current account deposits from DKK 23.2bn to DKK 69.7bn, hence limiting the extent to which the negative CD rate (which applies to deposits above the ceiling) bites. Nevertheless, in aggregate the banking sector will still have sizeable excess deposits at the CD rate, and this is the first time in Danish history that an official interest rate has gone negative: the [Danish central bank] has entered uncharted territory.