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ECB’s Panetta Says Digital Euro May Come With a Penalty Clause

  • Negative rates could discourage CBDC hoarding, official says
  • Central bank money for public may undermine banks’ stability
Fabio Panetta
Fabio PanettaPhotographer: David Paul Morris/Bloomberg

European Central Bank Executive Board member Fabio Panetta said a digital euro might be the innovation that sees negative interest rates passed directly to consumers.

Speaking at an event on Wednesday, Panetta said officials keen to prevent bank runs could make the hoarding of digital central bank money unattractive by “penalizing remuneration” of holdings in excess of 3,000 euros.