Bank of Japan and Interest Rates

financial community: Oil prices, which slumped to just $27 a barrel a fortnight ago, stood at $34, up 40 cents on the day, according to The Guardian. Yet the reverse is true. Watching world stock markets rally after the Bank of Japan cut interest rates gave a sense of relief to many in the financial community. If anything, investors are worried that governments and central banks have failed to realise how weak the global economy still is, seven years after the crash. When a central bank shows that it understands cheap money – in the form of lower interest rates – is a necessary underpinning for investment and growth, investors cheer. Dangerous levels of private debt in China, bad debts lurking in Europe banking system, nervous consumers everywhere: it a nuclear device that needs careful handling. (news.financializer.com). As reported in the news.