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Gold/Mining/Energy : An obscure ZIM in Africa traded Down Under -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (647)	1/25/2003 11:23:14 AM
From: TobagoJack	Respond to of 867

Japan rates sink into negative territory Saturday, January 25, 2003 biz.scmp.com REUTERS in Tokyo Japanese interest rates fell below zero for the first time yesterday, the effect of the Bank of Japan's policy of flooding the banking system with excess cash to hold interest rates to near zero. Bankers said the interest rate on overnight call money traded between banks dropped to minus 0.01 per cent and minus 0.02 per cent for January 27 to 28. By borrowing at a negative rate, borrowers, thought to be foreign banks, pay back less than the amount borrowed. For the lender, the operation is a way to reduce yen exposure when confidence in the Japanese banking system is low. Bankers said about 15 billion yen (HK$990.21 million) was traded at a negative rate. Negative rates are not new in the yen money market. There have been negative interest rates in the euro-yen market - the market for yen outside Japan - since the middle of last month. "[Money] has been getting cheaper in the euro market so I think they can still squeeze out some profit even by trading at minus 0.01 per cent," said Ryohei Muramatsu, a manager of group treasury at Commerzbank. Negative rates are rare. Economists recalled Switzerland's case where negative rates were used in the 1970s to scare foreigners out of Swiss franc deposits to lower the currency's value, which the authorities thought was too strong for the good of the economy.