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Japan's negative interest rates may have backfired: Fed paper
Central bankers in Europe and Japan have used negative interest rates to try to boost their economies and lift sagging inflation expectations, but Federal Reserve policymakers have been generally skeptical of doing so in the United States. New research from the San Francisco Federal Reserve Bank published Monday is likely to increase their doubts. When the Bank of Japan announced its plan to move to negative policy rates in 2016, inflation expectations actually fell rather than rose as policymakers had hoped, researchers at the San Francisco Fed wrote in the bank’s latest Economic Letter. Although the decline might ... (full story)