19:49 GMT +308 December 2019
Listen Live
    In this Nov. 19, 2014 file photo, a man walks by the Bank of Japan headquarters in Tokyo

    Bank of Japan Keeps Negative Interest Rate at -0.1%

    © AP Photo / Shizuo Kambayashi, File
    Business
    Get short URL
    0 43
    Subscribe

    The bank's asset purchasing program will also continue to include investment funds, real estate investment trusts and corporate bonds amounting to over 10 trillion yen.

    MOSCOW (Sputnik) — The Bank of Japan on Thursday kept its negative interest rate of —0.1 percent as well as its 80-trillion yen ($719 billion) asset purchasing stimulus package.

    "The Bank will apply a negative interest rate of minus 0.1 percent to the Policy-Rate Balances in current accounts held by financial institutions at the Bank," the bank said in a statement.

    The bank has also decided to keep its 10-year government bond yield target at around zero percent, thus keeping the same annual pace of government bond purchasing at 80 trillion yen, according to the statement.

    The bank's asset purchasing program will also continue to include investment funds, real estate investment trusts and corporate bonds amounting to over 10 trillion yen.

    Japan's central bank first cut its interest rate to below zero in early 2016 in an effort to stimulate the country's stagnating economy as well as avoid slipping into deflation.

    Japan's economy, which is currently the third largest by nominal GDP in the world after the United States and China, has been affected by stagnation and slow economic growth for years. The country's core inflation rate has hovered around and below zero since April 2015, continuing along the same trend since the 1990s, but has rebounded slightly since the adoption of more vigorous stimulus measures in late 2016. However, it remains far below the 2-percent official target.

    In 2012, Japan's Prime Minister Shinzo Abe announced measures to halt economic stagnation, including structural reforms, monetary easing and fiscal stimulus to help the country emerge out of its "lost decades." The plan, which was dubbed Abenomics and focused mainly on monetary policy, was introduced after Abe’s election in December 2013. It has been described as a failure by the opposition.

    Related:

    Against All Odds, Bank of Japan Adamant About Maintaining Negative Rates
    Bank of Japan Posts 699 Bln Yen in FX Losses, Eyes More Turmoil Ahead
    Bank of Japan Reverses the 'Trump Slump' in Bond Markets
    Bank of Japan Seeks Ways to Stimulate Economy Despite Negative Interest Rates
    Tags:
    Abenomics, Bank of Japan, Shinzo Abe, Japan
    Community standardsDiscussion
    Comment via FacebookComment via Sputnik