Shirakawa Says Central Banks Must Consider Risks of Low Rates
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Bank of Japan Governor Masaaki Shirakawa said central bankers must consider the dangers of keeping interest rates low for too long as they seek to strengthen the global recovery from the 2008 financial crisis.
“If low interest rates induce investment projects that are only profitable at such interest-rate levels, this could have an adverse impact on productivity and growth potential of the economy by making resource allocation inefficient,” Shirakawa said yesterday at a Federal Reserve conference in Washington.