BOJ faces beer drinker's dilemma on negative rates

Kuroda risks leaving Japan hungover with his monetary policy

20191114N Japan beer

Beer offers many valuable lessons -- including on monetary policy. © Reuters

KATSUJI KAMEI, Nikkei staff writer

TOKYO -- Japan's economic professors frequently draw on a common saying as a metaphor to teach students about diminishing returns: The first beer of the night is incredibly satisfying, the second one not as much.

Now this lesson is playing out in Japan's monetary policy, as the Bank of Japan weighs taking interest rates further into negative territory even as lenders approach their hard lower limit of 0%.

Sponsored Content

About Sponsored ContentThis content was commissioned by Nikkei's Global Business Bureau.