Japan’s decision to jettison negative interest rates is rich in symbolism. Deflation, which dogged the economy for a generation, has been dispatched. Workers are finally enjoying meaningful wage increases. Policymakers are no longer required to be defensive when they explain their country’s outlook. After a few false dawns, the nation has climbed out the hole it fell into after the property industry collapsed three decades ago. You might even think this marks the end of a certain exceptionalism.

The substance of the steps — Japan also did away with formally controlling long-term bond yields — warrants less champagne. The increase in the main rate is minuscule by the global standards of central banking: from minus 0.1%, where it has stood since 2016, to around zero. By the time the Bank of Japan got around to abolishing it on Tuesday, the sub-zero rate applied to a minute slice of real-life lending. Caveats abounded.

QOSHE - BOJ Has Hiked at Last, But This Tiny Step Is No Liftoff - Daniel Moss
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BOJ Has Hiked at Last, But This Tiny Step Is No Liftoff

11 10
19.03.2024

Japan’s decision to jettison negative interest rates is rich in symbolism. Deflation, which dogged the economy for a generation, has been dispatched. Workers are finally enjoying meaningful wage increases. Policymakers are no longer........

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