Tags: Japan | cash | sage | money

WSJ: Japanese Cash Hoarders Are Snapping Up Safes as Negative Rates Bite

WSJ: Japanese Cash Hoarders Are Snapping Up Safes as Negative Rates Bite

By    |   Monday, 22 February 2016 12:04 PM

Japanese consumers are heading to hardware stores in droves to buy safes as a way of protecting their cash after the country introduced negative interest rates.

Shimachu Co. , which operates a chain of stores selling hardware and home products, told The Wall Street Journal that sales of safes in the week that ended Sunday were 2½ times higher than in the same period a year earlier.

“In response to negative interest rates, there are elderly people who’re thinking of keeping their money under a mattress,” said Mariko Shimokawa, a saleswoman at a Shimachu store in eastern Tokyo, to the newspaper.

Bank of Japan Gov. Haruhiko Kuroda last month initiated the negative-rate policy to dissuade banks from holding some kinds of deposits at the central bank. That move was intended to give financial institutions an incentive to get more money circulating in the economy.

It may have backfired, though, with Japanese consumers hoarding cash in home safes. And banks don't provide much incentive to open savings accounts that pay a fraction of a percentage point in interest.

The popularity of safes was mentioned at a parliamentary hearing Monday, where opposition lawmaker Katsumasa Suzuki said the trend suggested a “vague sense of unease” among the public, according to the WSJ.

Kuroda said his negative-rate policy would help the economy by lowering interest rates on home mortgages and other kinds of debt.

The growing adoption of negative rates in Europe and Asia has economists speculating on whether the Federal Reserve will try similar policies.

One Fed governor this month dismissed that possibility, according to Reuters.

"To me, that's not something that should be part of the conversation right now," New York Fed President William Dudley told reporters when asked about possible use of negative rates.

The U.S. economy has "quite a bit" of strength to offset weakness from other countries, he said.





© 2019 Newsmax Finance. All rights reserved.

   
1Like our page
2Share
StreetTalk
Japanese consumers are heading to hardware stores in droves to buy safes as a way of protecting their cash after the country introduced negative interest rates.
Japan, cash, sage, money
311
2016-04-22
Monday, 22 February 2016 12:04 PM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved