Japan’s Interest Rates Turn Positive for the First Time in 17 Years

… The negative interest rate policy, combined with other measures to inject money into the economy and keep borrowing costs low, “have fulfilled their roles,” Bank of Japan Gov. Kazuo Ueda told reporters.

The bank has an inflation target of 2% that it used as a benchmark for whether Japan had finally escaped deflationary tendencies. But it had remained cautious about “normalizing” monetary policy, or ending negative borrowing rates, even after data showed inflation at about that rate in recent months.

Ueda said there was “a positive cycle” of a gradual rise of wages and prices, while stressing that monetary policy will remain easy for some time.

Although private sector banks and other financial organizations will make their own decisions about rates, he said did not foresee any drastic rises. The central bank will watch for any big moves in rates, which would cause confusion, he added.