According to the Wall Street Journal, central bank digital currencies (CBDCs) could actually negatively impact interest rates by giving policymakers an additional tool.
In his article, "Digital Currencies Pave Way for Deeply Negative Interest Rates," senior columnist James Mackintosh argues that the difference between a CBDC and cash would be highlighted if interest rates fell below zero. People would be more inclined to hold on to physical cash to “earn zero” rather than lose money on a digital dollar issued by the central bank.
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