21 February 2002, 08:19 BoJ's Hayami says "heartbroken" over zero rates but no other choice
TOKYO (AFX-ASIA) - Bank of Japan governor Masaru Hayami said his
"heart is broken" because he has no choice but to keep interest rates
near zero, even though the policy hurts family savings and weakens
structural reform.
"My heart is broken, seeing the continuation of the policy, as the
low rates hurt households' savings. Zero-interest rates also delay
structural reforms as they help weak companies to survive," Hayami told
a parliamentary budget panel.
"The BoJ cannot bring the current policy to an end, given the
reality of the economy," he added.
"We are maintaining a radical monetary policy in the hope that the
government's structural reforms will induce easing effects and
revitalise economic activity at the level of businesses," he said.
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