Key policy changes by major central banks

TOKYO, Aug 14 (Reuters) - Negative rate policy - once considered only for economies with chronically low inflation such as Europe and Japan - is becoming a more attractive option for some other central banks to counter unwelcome rises in their currencies.

But a closer look at Europe and Japan – where negative rates are in place – shows the performance has been mixed at best.

Below is a timeline of key European Central Bank (ECB) and Bank of Japan (BOJ) decisions in the development of unconventional rates policy: April 2013 * The BOJ introduces quantitative and qualitative easing (QQE) under Governor Haruhiko Kuroda, a massive asset-buying programme dubbed as "bazooka" stimulus.

June 2014 * The ECB adopts negative rate policy, cutting the deposit rate to -0.1% to stave off the threat of deflation, and also lowers its two other interest rates.

September 2014 * The ECB cuts all three of its interest rates, including its deposit rate which was cut to -0.2% from -0.1%.

October 2014 * The BOJ expands QQE as slumping oil prices and weak consumption threatened achievement of its price goal. December 2015 * The ECB cuts its deposit rate to -0.3% from -0.2%.

January 2016 * The BOJ adopts negative rate policy, setting its short-term rate target at -0.1%.

March 2016 * The ECB cuts all three of its interest rates, including its deposit rate which was cut to -0.4% from -0.3%, and expands its asset-buying programme. July 2016 * The BOJ eases monetary policy by ramping up buying of exchange-traded funds (ETF).

September 2016 * The BOJ revamps its policy framework, adding a 0% target for 10-year government bond yields to its -0.1% short-term rate target. The policy, dubbed yield curve control (YCC), was partly aimed at preventing long-term yields from falling too much.

July 2018 * The BOJ takes steps to make YCC more flexible, allowing yields to move in a wider band.

March 2019 * The ECB pushes out the timing of its first post-crisis rate hike to 2020 at the earliest, pledging to keep rates at record lows at least through the end of 2019. June 2019 * The ECB pushes back timing of projected rate hike, pledging to keep rates steady at least through the first half of 2020. July 2019 * The ECB signals readiness to keep monetary policy ultra-loose for a prolonged period, citing persistently low inflation. * The BOJ strengthens pledge to ease policy, saying it will do so "without hesitation" if a global slowdown jeopardises Japan's economic recovery. (Reporting by Daniel Leussink; Editing by Alex Richardson)

2019-08-14 01:00:36

© 2019 Thomson Reuters. All rights reserved. Reuters content is the intellectual property of Thomson Reuters or its third party content providers. Any copying, republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters shall not be liable for any errors or delays in content, or for any actions taken in reliance thereon. "Reuters" and the Reuters Logo are trademarks of Thomson Reuters and its affiliated companies.