Going negative? As trade war rages, central banks ponder radical steps

The Reserve Bank of New Zealand (RBNZ) - considered a pioneer in central bank policymaking circles since it adopted inflation-targeting nearly three decades ago - floated the possibility of negative rates last week as it, too, slashed rates by a bigger-than-expected 50 basis points and sent its currency tumbling to 3-1/2-year lows.

TOKYO/WELLINGTON: Negative interest rate policy - an unconventional gambit once only considered by economies with chronically low inflation such as Europe and Japan - is becoming a more attractive option for some other central banks to counter unwelcome currency rises.

In Asia, central banks in economies as diverse as Australia, India and Thailand have stunned markets by cutting aggressively rates in response to the broadening fallout from the U.S.-China trade war.