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| Asian markets surge after Bank of Japan's shock move to negative interest rates – live | |
| (35 minutes later) | |
| 6.37am GMT | |
| 06:37 | |
| Bank of Japan governor Haruhiko Kuroda speaking now | |
| Bank of Japan governor Haruhiko Kuroda is speaking now ... | |
| Updates shortly. | |
| 6.32am GMT | |
| 06:32 | |
| Markets surge | |
| Stock markets in Asia Pacific have yo-yoed wildly in the wake of the BOJ move, which spells yet another round of monetary easing in Japan. | |
| Generally speaking, traders have embraced quantitative easing in its various forms across the globe as it means cheap money and rising asset prices. | |
| In Europe, shares are expected to open up strongly this morning, according to futures trading. | |
| 6.18am GMT | |
| 06:18 | |
| Japanese inflation slowed to 0.5% | |
| Earlier on Friday, official figures showed inflation in Japan was 0.5%, way off the bank’s target of 2%. | |
| The BOJ hopes that the rates decision will encourage commercial banks to lend more, rather than keeping cash at the BOJ, and stimulate investment and growth. | |
| The BOJ’s statement added that Japan’s economy was still recovering but headwinds from volatile global financial markets could undermine confidence. | |
| The statement said: | |
| Japan’s economy has continued to recover moderately, with a virtuous cycle from income to spending operating in both the household and corporate sectors, and the underlying trend in inflation has been rising steadily. | |
| Recently, however, global financial markets have been volatile against the backdrop of the further decline in crude oil prices and uncertainty such as over future developments in emerging and commodity-exporting economies, particularly the Chinese economy. | |
| For these reasons, there is an increasing risk that an improvement in the business confidence of Japanese firms and conversion of the deflationary mindset might be delayed and that the underlying trend in inflation might be negatively affected. | |
| 6.11am GMT | |
| 06:11 | |
| The BOJ governor Haruhiko Kuroda will give a press conference in about 30 minutes which should help explain the thinking behind the decision, which sneaked through on a 5-4 vote of the bank’s board. | |
| The BOJ said it was adopting an interest rate of -0.1% for new excess reserves parked at the bank by financial institutions. | |
| The rate will not apply to existing deposits. Existing current account balances will earn a 0.1% positive interest rate. Required reserves held at the central bank by financial institutions will earn zero interest. Any additional current account deposits would incur the minus 0.1 percent rate, the BOJ said. | |
| But the bank added: | |
| The BOJ will cut the interest rate further into negative territory if judged as necessary. | |
| Read the full statement here. | |
| Updated | |
| at 6.14am GMT | |
| 5.42am GMT | 5.42am GMT |
| 05:42 | 05:42 |
| Opening summary | Opening summary |
| Hello and welcome to the business live blog. It’s been a very eventful night in the world of finance with Japan making the surprise (to some, at least) decision to adopt negative interest rates. | Hello and welcome to the business live blog. It’s been a very eventful night in the world of finance with Japan making the surprise (to some, at least) decision to adopt negative interest rates. |
| More on the detail of the decision very shortly but here’s a catch-up on what has happened: | More on the detail of the decision very shortly but here’s a catch-up on what has happened: |
| Read our news story from our correspondent in Tokyo, Justin McCurry: | Read our news story from our correspondent in Tokyo, Justin McCurry: |
| Related: Bank of Japan shocks markets by adopting negative interest rates | Related: Bank of Japan shocks markets by adopting negative interest rates |
| Updated | Updated |
| at 5.51am GMT | at 5.51am GMT |