Between 50% and 75% of the European Central Bank’s interest-rate changes were transmitted to the real economy, JPMorgan Chase economist David Mackie calculated in response to Bank of England Governor Mark Carney’s disparaging remarks on negative interest rates last week. “The combination of sovereign [quantitative easing] and the [targeted longer-term refinancing operations] has ensured a greater pass through of changes in the policy rate to changes in bank retail deposit and lending rates than might have been expected on the basis of past experience,” Mackie wrote.
Bloomberg (10 Aug.)
