what are the risks in the world?

2023-04-29 09:00:00

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CHRONIC. The change in Japan’s interest rate policy could have a dangerous influence on the global financial balance.

By Patrick Artus

In December 2022, Japan changed its 10-year interest rate policy by allowing a rate of up to 0.5%.
© KAZUHIRO NOGI / AFP

Published on 04/29/2023 at 09:00

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Ljapan made the choice in 2016 to radically modify its monetary policy to switch to a policy of controlling long-term interest rates (called Yield Curve Control). Initially, the 10-year interest rate was to be 0%, but last December this policy was changed to allow a rate of up to 0.5%.

We want to ask ourselves here about the risks for the economy of Japan and, more broadly, the world economy that the abandonment of Yield Curve Control and the return to free determination on the financial markets of the interest rate at 10 years.

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