BOJ tells low rates hurt banks, although woes can hardly ease post-stimulus

BOJ tells low rates hurt banks, although woes can hardly ease post-stimulus

Prolonged ultra-easy monetary policy is actually putting heavy pressure on Japanese bank revenues, although banks shouldn’t expect business conditions to brighten drastically even after the key bank has interest rates lifted, as a senior Bank of Japan official revealed.

A great number of regional financial institutions could suffer losses in the long run due to the fact intensifying competition simply forces them to reduce lending rates for the purpose of attracting borrowers in a shrinking domestic market, as BOJ Executive Director Atsushi Miyanoya told.

Even when monetary policy is normalized, financial institutions shouldn't expect revenues to get back to levels before ultra-easy policy was started.

After three years of heavy asset purchasing didn’t manage to fire up inflation, in 2016 the BOJ adopted negative interest rates along with a promise to guide 10-year bond yields around 0%.


What to Trade on August 22–26?
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How Energy Crisis Affects German PMI August 23, 2022, 10:30 GMT+3­­ Germany will publish Flash Manufacturing PMI data on Tuesday, August 23, at 10:30 MT time (GMT+3)…

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FED and BOE Make Another Attempt to Beat Inflation
FED and BOE Make Another Attempt to Beat Inflation

The Federal Reserve (Fed) will announce its Interest Rate Decision and make a statement about the future monetary policy on Wednesday, September 21, GMT+3. After the higher-than-expected inflation numbers published on September 13, there’s almost no doubt the Federal Reserve will come up with another 75-basis-point rate hike. However, surprised by the CPI numbers, several Fed members announced the possibility of a 100-basis-point rate hike on Wednesday.

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