The Bank of Japan’s introduction of negative rates in 2016 was a shock move that drew intense criticism from within the board. The decision, which was approved by a 5-4 vote, highlighted the resistance former BOJ chief Haruhiko Kuroda faced in pushing the limits of monetary policy.
Board Members’ Concerns
Board member Takehiro Sato warned that the move could draw Japan into a rate-cut competition with the European Central Bank to devalue their currencies. Commercial banker-turned board member, Koji Ishida, also expressed concerns that attempts to push down already low rates would do little to boost lending and capital expenditure.
The minutes of the meeting indicated that most board members were left in the dark as Kuroda and his staff prepared the plan. Board member Sayuri Shirai said of Kuroda’s proposal, “It appears to be half-baked and prepared in a hurry,” adding that the economy was not worsening enough to justify such a radical step.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
