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Investments glossary

Negative Interest Rate Policy (NIRP) Definition

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A negative interest rate policy (NIRP) is an unconventional monetary policy tool employed by a central bank whereby nominal target interest rates are set with a negative value, below the theoretical lower bound of zero percent. A NIRP is a relatively new development (since the 1990s) in monetary policy used to mitigate a financial crisis, and has only been officially enacted under extraordinary economic circumstances.


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