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Bank of Japan rates pivot cause to cheer in China

BOJ’s shift away from negative interest rates and toward a stronger yen will provide China some much-needed economic relief

by William Pesek March 19, 2024March 20, 2024

The Japanese yen is expected to strengthen with higher interest rates. Photo: Asia Times Files / AFP / Xie Zhengyi / Imaginechina

TOKYO — Xi Jinping’s inner circle in Beijing is probably breathing a little easier as the Bank of Japan steps away from 23 years of quantitative easing (QE).

On Tuesday (March 19), BOJ Governor Kazuo Ueda ended the globe’s last negative interest rate regime and scrapped Tokyo’s yield-curve-control experiment.

Its new range for policy rates is between 0% and 0.1%, pivoting away from the previous -0.1% target. The BOJ’s step was essentially the smallest it could have taken without upending global markets.