Japan’s central bank was widely expected Tuesday to scrap its maverick negative interest rate policy and hike borrowing costs for the first time in 17 years, according to economists and media reports.
The US Federal Reserve and other central banks yanked up rates to rein in galloping inflation after Russia’s 2022 invasion of Ukraine.
But haunted by the country’s “lost decades” of stagnation and deflation, the Bank of Japan kept its main rate negative, as it has been since 2016. The last hike was in 2007. Raising the main short-term policy rate from the current -0.1 percent will make loans more expensive for consumers and businesses, although the tweak will likely be minor.—AFP
