Central banks’ ultra-loose monetary policy is putting the world economy at risk, said William White, a senior adviser to the Organization for Economic Cooperation and Development.

Negative interest rates and quantitative-easing programs from the U.S. to Japan may have unintended side effects such as higher debt levels for both sovereigns and consumers, said White, who leads the OECD’s Economic and Development Review Committee. Central bankers have been dragged away from their focus on inflation as governments struggle to generate sustainable growth, he added.

“The objective of that policy has changed totally — it’s trying to stimulate aggregate demand and the honest truth is that it’s not capable of doing that in a sustainable way, ” White said in an interview. “If people thought we were in a period of deleveraging that would set the scene for a period of robust growth, we haven’t even started yet.”

Investors are looking for European Central Bank President Mario Draghi to ease policy in the euro area further as early as March as the slump in oil drags down inflation while the Bank of England has dialed back talk of increasing rates and bets on the Fed hiking again are retreating. Japan’s 10-year bond yields fell below zero for the first time ever on Tuesday after the central bank imposed negative interest rates on bank reserves.

Strain on Banks

White said he is “skeptical” about the benefits of such moves because of the strain they put on the banking system.

“Negative rates on reserves are actually squeezing bank profits, and this is something we don’t want in these circumstances, we want them to build up their capital buffers,” he said. “This is all experimental.”

White said that the global economy needs those governments with budget leeway to boost spending and said policy makers should pay more attention to wage growth, which remains “too low.” He said governments also need to make further structural reforms to boost growth and take a more systematic approach to debt reduction.