Negative interest rates

dunstonh

I've seen a few reports that the BoE is more than considering introducing negative interest rates.

If you avoid the gutter press and read past the headline, you would also probably have seen that if it happens, it will be commercial and professional (those with 6 digits in a single savings account) that would likely see the impact and not retail consumers.   

. I have a 5 figure sum in a Nationwide savings account, left over from when I purchased my home in 2014.

So you are not in the group that is likely to be affected by it.

My immediate thought is to buy a small safe, withdraw all of my funds in cash and hide it under the bed.

A high risk option with no justification for doing it.

Pingu1

Thank you for the responses, lots of food for thought. I got a message back from Nationwide too. They said
We believe it's highly unlikely that providers in the UK will charge retail savers for holding their money. Elsewhere in the world, charging has typically been limited to businesses rather than individuals.
If rates were to go significantly negative for a long period, then some providers may look to introduce new charges for current account customers.
However, Nationwide would expect to be able to withstand the financial impact of negative rates for longer than our main high street competitors. This is because we're a mutual and have historically paid at least 50% more interest on savings than the market average.
Not sure how much of this is true. Withdrawing lots of cash is probably an overreaction, particularly if cash is phased out. I haven't really thought about bonds but it might be worth considering.

dunstonh

Not sure how much of this is true.

Probably most of it apart from the lame attempt at marketing.

Withdrawing lots of cash is probably an overreaction, particularly if cash is phased out. 

cash is not being phased out and wont be.

Sailtheworld

EdGasketTheSecond said:

hmm crash on then; Q1 2021, again imho

You've already forecasted a crash for autumn 2020. Is the Q1 crash the same one with stretching of the dates or are you now predicting a crash in autumn and spring?

kaMelo

Sailtheworld said:

EdGasketTheSecond said:

hmm crash on then; Q1 2021, again imho

You've already forecasted a crash for autumn 2020. Is the Q1 crash the same one with stretching of the dates or are you now predicting a crash in autumn and spring?

.
As the saying goes,  a broken clock tells the correct time twice a day....they just keep predicting a crash and eventually they will be right.


As for the Nationwide response, this bit caught my eye.

Pingu1 said:

However, Nationwide would expect to be able to withstand the financial impact of negative rates for longer than our main high street competitors. This is because we're a mutual and have historically paid at least 50% more interest on savings than the market average.

Are they having a laugh?