The Bank of Japan raised its policy rates on Tuesday for the first time in 17 years, while also abolishing its yield control curve policy. The resolution today marks the end of the world’s last negative rates regime.
Local media were reporting during the weekend that there was a high probability that the Bank of Japan will exit the negative rates after the most anticipated economic data in Japan came Friday last week as Japan’s biggest companies agreed to raise wages by 5.28% for 2024, which would be the heftiest pay raise in 33 years in Japan.
On Tuesday, March 19, 2024, the Bank of Japan raised its short-term interest rates to 0 to 0.1% from the level of -0.1% that had been kept at a negative level since 2016.
Additionally, the Japanese central bank also announced the end of its yield curve control policy for its 10-year Japanese government bonds that it introduced to target longer-term interest rates, by buying and selling bonds as it deems necessary.
