Kuroda Says Negative ECB Rate on Loan Program ‘Bold and Unique’

Bank of Japan Governor Haruhiko Kuroda said the European Central Bank’s plan to potentially apply a negative interest rate on a loan program is "extremely bold and unique." He also reiterated that the BOJ would adopt appropriate policy measures to boost inflation as needed.

In a program set to start in June, the ECB is poised to offer zero-rate funding, which could retroactively be cut to the ECB’s deposit rate -- currently minus 0.4 percent -- depending on how much the lender extends to companies and households.

When asked in parliament whether the BOJ should consider such a policy, Kuroda described the ECB’s policy as "extremely bold and unique" and reiterated the bank’s stance that it would further ease policy if it thought it was necessary to achieve its inflation target.

Bloomberg reported last month, citing people familiar with talks at the BOJ, the central bank may consider offering a negative rate on some loans in conjunction with any decision to make a deeper cut to the current negative rate on reserves.