Photo: Collected
Japan's central bank raised interest rates on Tuesday (19 March) for the first time in 17 years, pushing them to a range of 0% to 0.1% after years of negative borrowing costs meant to boost the economy.
In February 2007, the regulator hiked interest rates to 0.5%, before cutting them in October 2008 and onward. In January 2016, Japan turned to negative interest rates of -0.1%.
"The Policy Board of the Bank of Japan assessed the virtuous cycle between wages and prices, and judged ... that the price stability target of 2 percent would be achieved in a sustainable and stable manner toward the end of the projection period of the January 2024 Outlook Report. The Bank considers that the policy framework of Quantitative and Qualitative Monetary Easing (QQE) with Yield Curve Control and the negative interest rate policy to date have fulfilled their roles," the central bank said in a statement.
The regulator also said it would stop purchases of exchange-traded funds (ETFs) and Japan real estate investment trusts (J-REITs) as well as "gradually reduce" the number of purchases of commercial papers and corporate bonds to discontinue them altogether in about a year.
The Japanese economy has "moderately" recovered, the central bank said, adding that corporate profits have grown and labor market conditions have been tight.
Messenger/Mumu
