Nearly half of Japanese firms hurt by BOJ interest rate hikes - Reuters poll

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Get bite-sized news via a newcards interface. Give it a try. Click here to return to FAST Tap here to return to FAST FAST TOKYO, July 16 : Nearly half of Japanese firms are experiencing negative business impact from the Bank of Japan's interest rate hikes, with higher borrowing costs hurting bottom lines and discouraging capital investment, a Reuters survey showed on Thursday.

The BOJ ended its negative interest rate policy in 2024 and last month raised its short-term policy rate to a 31-year high of 1.0 per cent from 0.75 per cent.

It also signalled readiness to tighten further to tame price pressure stemming from the energy shock brought about by conflict in the Middle East.About 5 per cent of survey respondents said BOJ hikes have had a significant negative impact on operations and 44 per cent said they have had a somewhat negative effect, whereas 46 per cent said they have had no impact.The remaining 5 per cent said higher interest rates have had a somewhat positive effect on their businesses.

CNA Games Guess Word Crack the word, one row at a time Buzzword Create words using the given letters Mini Sudoku Tiny puzzle, mighty brain teaser Mini Crossword Small grid, big challenge Word Search Spot as many words as you can Show More Show Less "Interest burden has already grown sharply from last year. A further increase would have a large impact on our company," an official at a machinery maker wrote in the survey.Mitsubishi UFJ Financial Group became Japan's most valuable stock in terms of market capitalisation this week due to investor expectations that higher rates would boost profit.

Asked about desirable timing of any subsequent rate hike, 12 per cent chose the current July-September quarter, 27 per cent picked October-December and 27 per cent selected the first half of 2027, while 26 per cent said an increase would not be desirable at any time.The BOJ's next policy meeting is scheduled for July 30-31.About 12 per cent of respondents said a policy rate of 1.

25 per cent would curb capital investment, while 16 per cent put the threshold at 1.5 per cent and 27 per cent said investment would be affected only if rates rose beyond 1.5 per cent.

Almost a third of respondents said capital investment has already been adversely affected under the current rate environment. "We need to carry out investment for maintaining existing facilities as well as fresh capital investment. It's not easy to 'normalise' our mindset that is accustomed to negative or low interest ra