The basic foundation of market economy is free markets. Let markets decide prices and ....interest rates. However, many corporate have now mastered the skills to control prices, politicians and central banks on the other hand have taken up the task of deciding interest rates!! To achieve growth and economic expansion, spenders and speculators are encouraged at the expense of disciplined consumers and savers! Retired people as punished as they are not able to get interest income and are forced to move to risky assets.
*******************************************
The Bank of Japan will not rule out deepening a cut to negative rates it introduced in February, the Sankei newspaper quoted Governor Haruhiko Kuroda as saying, even as the controversial policy has failed to spur inflation or economic growth.
In an interview with the daily, Kuroda said the BOJ's negative rate policy has not reached its limits.
"The degree of negative rates introduced by European central banks is bigger than Japan. Technically there definitely is room for a further cut," Kuroda told the Sankei.
The BOJ stunned markets in January when it set a minus 0.1 percent rate on some deposits that banks place at the central bank, with the move taking effect from February.
While the BOJ hoped the shift to negative rates would encourage banks to lend more, spurring higher spending and inflation, none of that has happened as yet.
The BOJ will also consider whether to make any changes to the 80 trillion yen ($798 billion) per year massive asset-purchase plan once the outcome of a comprehensive assessment of its monetary policies is out in September, Kuroda said.
No comments:
Post a Comment