The intention behind the policy has always been temporary – to boost aggregate demand, closing the output gap more quickly, helping to normalise inflation and subsequently interest rates. Only if central banks were to allow prolonged deflation could negative rates be considered a permanent instrument.
Outside such an environment, the accumulated negative spillovers of negative rates on the profitability of financial institutions, and the interference on the role of monetary and financial assets as a store of value, would be unacceptable. The long-term consequences of an environment with low but positive inflation and negative rates would become too severe for the financial sector, savers and pensioners.