Bloomberg quotes people familiar with the matter, as citing that the Bank of Japan (BOJ) official believe that if they choose to lower interest rates further into the negative territory in the coming months, it wouldn’t backfire as markets have priced-in such a possibility.
The officials added that the BOJ is also increasingly confident that commercial banks are strong enough to cope with a lower negative rate and don’t see the pain becoming overly disruptive to Japan’s overall financial system, per sources.
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