- Haruhiko Kuroda, BoJ Governor
Bank of Japan Governor Haruhiko Kuroda said that the central bank will study the effects of negative interest rates on the world's third biggest economy, indicating that no immediate expansion of stimulus was planned. Kuroda also remained upbeat on Japan's economic growth outlook, countering criticism that the central bank's decision to introduce negative interest rates has had little positive impact on markets. Yet, the central banker reiterated that the BoJ stands ready to ease monetary policy again, either by accelerating asset purchases or pushing rates deeper into negative territory, if needed to reach the 2% price goal. Kuroda also added that current negative rates would have a "very powerful" stimulus effect on the Japanese economy by driving down borrowing costs and encouraging firms to boost investment. The "Abenomics" economic strategy of Prime Minister Shizno Abe relies on central bank stimulus to underpin growth, but Abe said that the BoJ has adopted negative interest rates of its own accord, and denied that his policy was unsuccessful, despite low growth and weak inflation.
The BoJ unexpectedly cut the benchmark interest rates below zero in January, as turbulent markets and slowing global growth threaten its efforts to overcome deflation.
© Dukascopy Bank SA