The reason official interest rates are approaching zero in a growing list of countries is not because central banks think it is a good idea to make credit available for free. It is because the flow-through from official rates to the rates that matter most in these economies – those paid by businesses and households – has not been working very well.
The total value of personal deposits in banks increased by $ billion between February and December 2020.5 This exceeded the average pace at which deposits have been increasing over the past decade by about $ billion.6  usual because of the pandemic, compared with only 20 percent for households earning less than $ 5 Statistics Canada Table: 10-10-0116, vector: V41552791 6 If deposits had kept growing at their trend growth following the global financial crisis, they would  have increased by only $ billion from February to December.