Zero lower bound

Monetary policy - interest rates.

(ZLB).

Zero lower bound is an assumption that interest rates should not be, or cannot be, lower than zero.

In practice, a number of central banks have implemented negative official interest rates.

For example, the European Central Bank fixed a negative rate in 2014 for interest on excess reserves.

Sometimes expressed as Zero Nominal Lower Bound (ZNLB), emphasising that the rates in question are conventional nominal interest rates (rather than inflation adjusted 'real' rates).

See also

• Discount rate
• Effective lower bound
• Interest on excess reserves
• Interest rate
• Keynesianism
• Monetary policy
• Money supply
• Nominal
• Open market operations
• Quantitative easing
• Real
• Reserve requirements
• Unconventional monetary policy
• ZLB problem