BoJ begins negative rate
The Bank of Japan on Tuesday started charging 0.1 percent on a portion of the excess funds that financial institutions have in accounts at the central bank.
The negative interest rate would have applied to 23.2 trillion yen ($203 billion) if the policy had been in place last month, the bank estimated. While the new monetary tool took effect on Tuesday, figures for its application won't be available until the middle of March. The central bank had previously estimated that the rate of minus 0.1 percent would be applied on about 10 trillion yen of financial institutions' reserves held at the BoJ.
Governor Haruhiko Kuroda unveiled the policy on Jan. 29 to spur banks to lend by penalizing them for holding some of their excess reserves at the central bank.
The immediate impact remains unclear because Japan has been buffeted by external forces in the two weeks since the announcement, with the yen strengthening and stocks dropping amid concerns over the slowing Chinese and global economies.
Sixty-one percent of respondents in a poll said the minus rate policy won't buoy the economy while only 13 percent said it will, according to the poll released on Tuesday. The BoJ adopted a three-tier system to limit the amount of losses for banks.