BoJ’s Nakaso sig­nals Ja­pan may re­duce rates again

The Pak Banker - - FRONT PAGE -

Bank of Ja­pan Deputy Gover­nor Hiroshi Nakaso in­di­cated the cen­tral bank is pre­pared to take its bench­mark rate deeper into neg­a­tive ter­ri­tory, though not im­me­di­ately.

"We have de­signed a pol­icy that tech­ni­cally al­lows us to cut the level fur­ther," Nakaso told re­porters in Ok­i­nawa Thurs­day, re­fer­ring to a mi­nus 0.1 per­cent in­ter­est rate pol­icy the cen­tral bank adopted in Jan­uary. "I can't say any­thing con­crete at this point" on how low the rate could go, he said.

Nakaso, a ca­reer Bank of Ja­pan of­fi­cial tapped by Prime Min­is­ter Shinzo Abe as one of Gover­nor Haruhiko Kuroda's two deputies, also said that fi­nan­cial mar­kets need time to di­gest the un­prece­dented neg­a­tive-rate pol­icy. It took ef­fect Feb. 16.

"Some more time is needed for fi­nan­cial mar­kets to di­gest the pol­icy and for us to mea­sure the im­pact of it," said Nakaso, who is a for­mer di­rec­tor at the Bank of Ja­pan's mar­kets sec­tion.

The Bank of Ja­pan has faced a back­lash against the Jan. 29 de­ci­sion to charge com­mer­cial banks on a share of the cash they park at the cen­tral bank. The re­ac­tion has cast a cloud over the BoJ's next pol­icy meet­ing, sched­uled for March 14-15.

Newspapers in English

Newspapers from Pakistan

© PressReader. All rights reserved.