Japan struggling with negative rate impact on swaps

Dealers facing issues with collateral interest payments and loan mismatches

Yen negative rates

Swaps market participants in Japan are struggling to find common ground as the country's central bank continues its experiment with negative interest rates.

The policy, which was introduced in January, implies a collateral poster would also have to pay interest, rather than receive it – a question that has split the market. As things stand, some parties will pay negative rates, while others insist the rate should be floored at 0%, creating funding and technology headaches.

Lawyers in the country

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Risk.net? View our subscription options


Want to know what’s included in our free membership? Click here

This address will be used to create your account

Most read articles loading...

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here