The European Central Bank (ECB) is considering using negative interest rates, a tool that erodes the value of your money, as it introduces the digital euro — its central bank digital currency (CBDC).
This is according to Sarah Palurovic, the executive director of the Digital Euro Association (DEA) think tank.
During an appearance on the Poundcast podcast, Palurovic said that the ECB wants to “keep the possibility open for tiered remuneration” after it introduces the digital euro because the ECB wants to have “measures that incentivize or disincentivize people to hold more or less CBDCs.” She added that one of the measures the ECB is considering is negative interest rates.
Negative interest rates allow bureaucrat at central banks to choose a rate at which your money expires and punish those who save their money. For example, if they set a negative interest rate of -10%, you lose 10% of your money each year unless you spend it.
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