Luckily, economists are saying that is unlikely to happen in Singapore.
Read this article in the papers today
Could interest rates hit zero? - The Straits Times May 13 2010
Apparently it has happened in Japan.
Singapore Interbank Offer Rate (Sibor), which is the rate at which banks lend to each other, has fell to a new low. Because of this fall, banks has reacted by cutting the the savings rates they offer to consumers.
Do you know the savings interest rates that the banks are offering right now?
It is about 0.1%!!! (Click here to check the savings rates online for DBS)
What this means is, for a $10,000 balance in your savings account that pays only 0.1%, the grand total of your interest at the end of 1 year is $10!
Even fixed deposit rates are hovering around 0.1% to 0.7% (Click here to check the Fixed Deposit Rates online for DBS) depending on the amounts and tenure you set aside.
With the what is happening with the economies of US and Europe, the rates are expected to remain this low for the foreseeable future.
Perhaps it's time to look for possible alternatives to make your money work harder for you?
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