each piece of communication. summing over the 17 pieces of communication included in the study, we arrive at the effects that you can see here. 1 the chart shows that in all of the 2 - day windows combined, danish 10year sovereign bond yields declined by a total of 30 basis points. this is very close to the corresponding decline in german yields of 28 basis points. yields in other northern european countries declined slightly more. however, countries in the south of europe experienced substantially larger declines in yields. to sum up, danish and german bond yields are close substitutes. the impact of qe on bond yields in the euro area also has a spillover effect on danish bond yields. 3 monetary policy when rates go negative let me share with you some of our experiences with very low and negative interest rates. danmarks nationalbank pioneered by setting a key monetary - policy rate well below zero already in 2012 to stave off large capital inflows. since then, many other central banks, including the ecb and the snb, have now gained experience with policy rates significantly below zero. with monetary policy rates as low as currently - 0. 75 per cent in switzerland and - 0. 65 per cent in denmark, we have been in unchartered territory for some years now. what have we learnt from this period? a key message is that the situation with negative policy rates in denmark largely mimics that of low, but slightly positive rates. and side effects have generally been negligible. in the following i will go a bit more into detail on some of the aspects. [ chart 8 : different deposit rates for different segments ] there has been more or less full pass - through to lending rates in the economy since the key policy rate was lowered to - 0. 75 per cent in 2015. however, the degree of pass - through to banks'deposit rates has differed across customer segments. many large non - financial corporations face negative interest rates on their bank deposits. the same applies to the majority of insurance and we use the 17 events listed in carlo altavilla, giacomo carboni and roberto motto, 2015, asset purchase programmes and financial markets : lessons from the euro area, ecb working paper series, no 1864. page 7 of 9 pension companies. this is appreciated due to the importance for the transmission to the exchange rate. banks have, on the contrary, been reluctant to introduce negative interest rates to households. their actions have generally little impact on the exchange rate. with negative policy

and the loss of confidence in the building blocks of the financial system, its impact was magnified through quick transmission to other economies as well. monetary authorities in the advanced economies were the first to resort to aggressive monetary easing first by reducing policy rates. however, key channels of conventional monetary policy were severely impaired during the crisis as policy rates in most advanced economies approached zero lower bound ( chart 1 ). bagehot walter ( 1873 ), lombard street : a description of the money market, king & co., london ; reprinted wiley, new york 1999. bis central bankers ’ speeches taking cognisance of the severity of the crisis and concerns of economic recession, central banks used their balance sheets in unconventional ways to augment liquidity ( table 1 ). the qe programmes initially attempted to alleviate financial market distress, but this purpose soon broadened to include achieving inflation targets, stimulating the real economy, and containing the european sovereign debt crisis ( fawley and neely, 2013 ) 2. now let us discuss a little about the rationale for unconventional policies undertaken across major economies. table 1 fawley, brett w. and christopher j. neely ( 2013 ), “ four stories of quantitative easing ”, federal reserve bank of st. louis review, january / february, vol. 95, no. 1. bis central bankers ’ speeches in the us, immediately after the collapse of lehman brothers, when slow growth and high unemployment emerged as major concerns, the fed announced the policy of quantitative easing ( qe ) in november 2008. the first two rounds of qes reactivated financial markets, but failed to spur growth. under “ operation twist ” instituted in september 2011, the fed took initiative of buying longer - term treasuries and simultaneously selling some of the shorterdated securities to bring down long - term interest rates which continued till december 2012. with a view to putting in place a stronger version qe, it launched qe3 in september 2012. under qe3, the fed started purchasing us $ 85 billion of fixed - income securities per month. the fed intended to keep qe3 in effect until unemployment falls to 6. 5 per cent or inflation rises to 2. 5 per cent. in addition to qe3, the fed gave a forward guidance that it would keep short - term rates low through 2015. as economic parameters showed improvement, the fed started talking about exit, popularly known as the tapering of bond buying in may 2013. subsequently, it announced to