ECB’s Coeure: Negative interest rates are not our main instrument

ECB Governing Council member Mr. Benoit Coeure is crossing the wires via Reuters, noting that negative interest rates only support overall ECB policy and may not be considered the main instrument.

Key Quotes:

Negative interest rates are not our main instrument, they just support our overall policy

Helicopter money is not currently part of the discussion in the governing Council

Banks have been reassured about the possible negative impact of negative rates on some of them

Banks know the ECB will not take rates into absurdly negative territory, but can never rule out further moves

Doesn’t see how helicopter money could work without some kind of risk-sharing with govts, which could be practically and legally problematic

Fair deal of skepticism and circumspection with regard to helicopter money