Ex-BoJ member sees no rate cut without fresh economic crisis

Low-rate: A file picture showing people wearing protective masks in a shopping district in Tokyo. Weak inflation alone won’t be enough to trigger a rate cut, despite the central bank’s efforts last month to show its readiness to do so. — Reuters

TOKYO: The Bank of Japan (BoJ) is highly unlikely to deepen its negative interest rate without a fresh economic crisis on a massive scale, according to former board member Makoto Sakurai, whose term ended last month.

“The BoJ didn’t lower rates” even at the height of the pandemic shock last year in March, Sakurai said in his first interview since leaving the central bank two weeks ago. “The kind of historic crisis needed to trigger a cut very rarely takes place.”