Why the sharp fall in real interest rates has not eliminated the euro zone’s excess savings

Real interest rates i n the euro zone are now negative, and yet the zone’s excess savings remain very significant, which shows the ineffectiveness of euro-zone monetary policy. What accounts for this ineffectiveness? Mainly the nature of the euro zone’s savings surplus: it is due to two anomalies of behaviour in Germany: A strong preference for savings; A refusal to lend to other euro-zone countries. These two anomalies of behaviour cannot be corrected by low real interest rates.