The National Bank of Hungary cut its overnight deposit rate by 15 basis points to -0.05 percent on Tuesday and lowered its overnight lending rate to 1.45 percent from 2.1 percent. The bank has also cut its key base rate by 15 basis points to 1.2 percent despite market expectations for no change at the March policy meeting.

The main facade of the Hungarian central bank. Bloomberg/Contributor | Bloomberg | Getty Images

Negative rates is a policy tool which has already been deployed by the likes of Japan, Switzerland, and the European Central Bank (ECB).

Denmark's central bank became one of the first to adopt negative deposit rates in July 2012 at negative 0.2 percent. It has since pushed rates to minus 0.65 percent , in a bid to spur further bank lending and boost the country's economic recovery. Switzerland has set its own deposit rate at negative 0.75 percent, while Sweden has pushed its key interest rate to negative 0.5 percent. Most recently, the European Central Bank stopped short of a dip below zero on its main refinancing rate but slashed its deposit rate to minus 0.4 percent.