On the other hand, in the case of the United Kingdom, inflation target was set at 2.5 percent by the government in 1997 and has been maintained thereafter.
We have clear evidence that cutting the deposit facility rate below zero percent has provided additional economic stimulus as it has fed into lower lending rates, thereby helping to improve overall financing conditions for firms and households. Of course, despite these positive effects, negative interest rates have often been criticised because of their potential adverse side effects.