When negative rates end, US Treasuries will suffer

FILE PHOTO: Bank of Japan Governor Kazuo Ueda speaks at a group interview with media in Tokyo, Japan, May 25, 2023. REUTERS/Kim Kyung-Hoon/File Photo

Tokyo: Japan’s era of negative interest rates will end in coming months, and the implications for world markets will be enormous, with US Treasuries set to suffer the most, according to the latest Bloomberg Markets Live Pulse (MLIV) survey.

The Bank of Japan (BoJ) is likely to unwind its unusual policy of sub-zero rates during the first half of 2024, the majority of 315 respondents said. The move would bring an end to a bold experiment it embarked on in 2016 – one that’s recently placed Japan at odds with other major central banks that have been tightening aggressively to combat inflation.