The Bank of Japan’s jump into negative interest rates Friday won government praise as a “bold” measure to fight the nation’s chronic deflation.
The government “appreciates the introduction of a bold method to achieve its price stabilization goal,” Chief Cabinet Secretary Yoshihide Suga said at a news conference, referring to the central bank’s 2 percent inflation target, which was pushed back for a third time on Friday.
The top government spokesman then asserted that the independent BOJ is expected to “continue efforts to achieve the price stabilization goal while taking into account economic and price developments.”
Earlier Friday, the BOJ unexpectedly cut a benchmark interest rate below zero in an apparent attempt to encourage more lending, and hopefully an increase in business activity, by making banks pay the BOJ to keep excess cash on hand there.
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