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Japan ex-cabinet advisor opposes early end to negative rates

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A former adviser to late Japanese Prime Minister Shinzo Abe on Sunday voiced opposition to ending negative interest rates any time soon, saying premature action by the central bank would push the economy back into deflation. Speculation is rife that the Bank of Japan may ditch negative rates as early as March or April given expectations that major firms will offer higher pay rises at annual spring labour-management talks due to wrap up March 13. However, small firms, which conclude wage talks by June, have a high ratio of workers’ share of corporate profits, making it difficult to raise wages further.

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