ECB's Mersch warns further rate cuts could backfire
Charging banks even more to park their money with the European Central Bank could backfire if the damage to the banking sector outweighs the benefit for borrowers, ECB Executive Board member Yves Mersch said on Monday.
As part of its efforts to stimulate lending, the ECB has been applying a penalty charge - or negative deposit rate - on banks' excess deposits for over two years, triggering a backlash from cash-rich banks especially in Germany.
Mersch defended the ECB's policy, saying it has helped bring down unemployment and boost growth in the euro zone, but acknowledged the banking sector... read more
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