After the 2008 financial crisis the world's main central banks cut interest rates to soften the impact on jobs and growth. A newish study by the McKinsey Global Institute assesses the distributional effect of these very low interest rates in the US, the Eurozone and the UK.
“By the end of 2012, governments in the United States, the United Kingdom, and the Eurozone had collectively benefited by $1.6 trillion, through both reduced debt service costs and increased profits remitted from central banks. Meanwhile, households in these countries together lost $630 billion in net interest income, with variations in the impact among demographic groups. Younger households that are net borrowers have benefited, while older households with significant interestbearing assets have lost income. Non-financial corporations across these countries benefited by $710 billion through lower debt service costs.”
