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Viewsroom

Japan’s rate shift will hit zombie firms hardest

Viewsroom

Reuters

News

4.458 Ratings

🗓️ 14 March 2024

⏱️ 19 minutes

🧾️ Download transcript

Summary

The central bank could end an era of negative borrowing costs as early as next week. In this Viewsroom podcast, Breakingviews columnists argue that large companies are ready for the tightening, but many struggling small businesses could hit the wall even if policymakers go slow. Visit the Thomson Reuters Privacy Statement for information on our privacy and data protection practices. You may also visit megaphone.fm/adchoices to opt-out of targeted advertising. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0

The views expressed on this podcast are those of the participants, not Aroger's News.

0:08.3

We think the central bank is finally about to move away from this policy of negative interest rates

0:15.2

and capping yield on government bonds to keep interest rates low. So a very, very loose monetary policy.

0:22.1

We think they will move either this month or next month for the first time in decades.

0:26.5

The US and Europe are still grappling with inflation and trying to figure out what is the

0:31.4

right level of interest rates. Japan, on the other hand, still has very little inflation,

0:36.5

but is hoping that higher wages

0:38.0

will allow the central bank to end an era of negative interest rates.

0:42.3

But such a change may take a toll on a horde of so-called zombie companies.

0:47.3

This fascinating situation is the focus of this week's Views Room.

0:52.7

Welcome back to the Views,, a podcast from Reuters breaking

0:55.5

views where columnists from around the world talk about the big stories of the week. I'm your

0:59.9

host, Amy Donnellan, coming to you from London. Japan is on the cusp of dramatic changes. I spoke

1:07.1

to my colleagues, Francesco Guerrera, our global head of economics and breaking views,

1:11.5

and Uda Galani, our Asia editor earlier this week, about what it all means.

1:20.3

Hi, just leave on work now. Sorry, it's a bit loud.

1:23.1

Basically, so I was thinking we could get Macies tonight.

1:25.1

I had a big Mac on my mind all day, and delivery fee on the app is now from 99P.

1:29.3

So you win?

1:30.5

Of course you are.

1:31.0

Love you.

1:31.6

Bye.

...

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