BoJ Votes Down the Cancelling on Interest Payments to Lender Depositors

“The proposal by a Bank of Japan (8301) board member to scrap interest paid on lenders’ deposits raises the prospect of a flood of cash into a bond market where yields are near a nine-year low.

While Koji Ishida’s plan to abolish the 0.1 percent payment was rejected by a majority vote when a two-day meeting ended yesterday, incoming prime minister Shinzo Abe has called for unlimited easing until 2 percent inflation is achieved. The 10- year note yield slid for a second day to 0.765 percent today, third only to Switzerland and Hong Kong among the world’s lowest rates, as the BOJ expanded its asset-purchase program and held its separate overnight interbank lending rate at between zero and 0.1 percent….”

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