ECB interest rates safely above detrimental level: Coeure
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European Union flags are lowered at half-mast to commemorate the victims of the Bastille Day truck attack in Nice, outside the headquarters of the European Central Bank (ECB) in Frankfurt, Germany, July 15, 2016. REUTERS/Ralph Orlowski
FRANKFURT (Reuters) - Excessively low European Central Bank interest rates over a long period could do more harm than good but current rates are safely above such a level, ECB Executive Board Member Benoit Coeure said on Thursday.
"The current conditions of financial intermediation suggest, however, that the economic lower bound is safely below the current level of the deposit facility rate and that the impact of negative rates, combined with the asset purchase program and forward guidance, has clearly been net positive," he said.
"But there can be cumulative effects on financial intermediation and financial stability if rates remain very low for a very long time," Coeure told a conference at the Yale School of Management in the United States.
(Reporting by Balazs Koranyi; Editing by Louise Ireland)
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