AKITA, Japan (Reuters) - Bank of Japan Deputy Governor Hiroshi Nakaso said on Thursday that negative interest rates were already having a positive impact on the economy, and that the impact would spread over time.
“We must of course be mindful of the various side effects of negative interest rates, such as the effect on market liquidity, in guiding policy. Even so, the positive effects (of negative rates) are big,” Nakaso told a news conference after meeting with business leaders in Akita, northeastern Japan.
The BOJ stunned markets in January by adding negative interest rates to its massive asset-buying program in a fresh attempt to accelerate inflation to its 2 percent target. It has kept monetary policy steady since then.
Reporting by Leika Kihara; Editing by Chang-Ran Kim