Looser monetary policy introduced as a response to the Covid-19 pandemic may be keeping “zombie firms” alive, two Bank for International Settlements economists warn.
Speaking on a BIS podcast on April 13, economists Boris Hoffman and Ryan Banerjee said that low interest rates mean that unprofitable firms can tap cheap credit, which helps them to avoid bankruptcies. Economists define “zombie firms” as firms that are persistently unprofitable and which the market judges unlikely to return to
You are currently unable to print this content. Please contact [email protected] to find out more.
You are currently unable to copy this content. Please contact [email protected] to find out more.