We are about to reach a major turning point from a "world without interest rates" to a "world with interest rates." If negative interest rates are actually lifted, what impact will they have on our lives? Here is an explanation. ■ What impact will lifting negative interest rates have on companies and our lives? Ayu Yamauchi, anchor: What happened during the negative interest rate policy in the first place? A negative interest rate policy means that banks actively lend money. This makes it easier for companies to borrow funds and for individuals to borrow mortgages and other loans. It was introduced in 2016 as a policy aimed at revitalizing economic activity and improving the economy, and has continued for a long time. So why are we moving toward lifting negative interest rates at this time? The first reason is that wage increases have increased, and the second reason is rising prices. Saisuke Sakai, Mizuho Research & Technologies: It has become clear that the 2024 spring labor offensive will see wage increases that are significantly higher than those in 2023. I believe that this has given the Bank of Japan the push to revise its monetary policy this time. It is said that wage growth is not keeping up with prices, real wages are negative, and consumption is weak. If wages rise in this spring offensive, people's incomes will increase, and real wages will also become positive after the summer of 2024, and companies will be able to pass on the increase to prices with peace of mind as consumption increases. I think the Bank of Japan has decided that it is possible to realize this price increase accompanied by wage increases, a "virtuous cycle of wages and prices." ■ Will the "labor shortage" lead to a sustainable "wage increase"? What about wage increases for small and medium-sized enterprises? Caster Chiaki Horan: This time, interest rates will be reviewed for the first time in 17 years, so considering that they do not change frequently, will wages also rise in the long term? Mr. Sakai: Each company's profits have been at an all-time high, so there is a movement to give this back to workers. As the labor shortage becomes more serious, investment in people and a spirit of "taking care of workers" are spreading among companies. And since the labor shortage will continue structurally in the future, I think the Bank of Japan also believes that this trend can be foreseen to continue. Holancaster: On the whole, large companies are able to raise wages, but there are concerns about how far this will affect small and medium-sized enterprises. Will the wage increase be able to withstand rising prices? Sakai: One point is whether small and medium-sized enterprises will be able to raise wages. The wage increase rate for the spring labor offensive compiled by the federation this time is basically led by large companies. However, in response to the worsening labor shortage, there is a growing momentum to realize relatively high wage increases in small and medium-sized enterprises as well. Even if the wage increase is centered on large companies, if a high wage increase is realized at large companies, the salaries of people working at large companies will increase, so consumption will increase when viewed from the perspective of the economy as a whole. If that happens, it can be foreseen that the prices of the products and services they provide will be easier to rise, even from the perspective of small and medium-sized enterprises. If this trend spreads, I think it will become possible to realize a certain level of high wage increases even after 2025. Professional Manager Harold George May: There are a few key words, and we're talking about inflation, but for it to rise steadily and steadily, our incomes must also rise steadily and steadily. This time, wages are likely to rise, but I don't think it's clear whether that will really be the case. However, I think our individual awareness will change. ■ Will mortgage repayments increase with the rise in "variable interest rates"? Caster Yamauchi: When we look at how rising interest rates affect our lives, it turns out that mortgage interest rates will rise. Let's look at the "variable interest rates" that many people borrow. 70% of people who have taken out mortgages are borrowing at variable interest rates. It is said that interest rates will rise by about 0.1%, so if we calculate it based on this, for example, if the loan amount is 35 million yen, the repayment period is 35 years, and the current fluctuation is 0.4 to 0.5%, if this rises by 0.1%, the total repayment amount will increase by about 700,000 yen. This is an increase of 20,000 yen per year. If wages were actually raised by about 20,000 yen a year, this would not be a scary thing, but we are still worried about whether the wage increases will continue. Future outlook for lifting negative interest rates. Chief economist Saisuke Sakai said, "Price increases will ease and the burden on households may be reduced," but added, "Small and medium-sized enterprises will find it difficult to manage their finances, and some companies may be forced into bankruptcy." Mr. Sakai: As we are now in the midst of a world where interest rates will rise, I think we consumers and companies need to change our mindset. ▼TBS NEWS DIG Official Website https://newsdig.tbs.co.jp/ ▼Please subscribe to our channel! / @tbsnewsdig ▼Information provided by "TBS Insiders" https://www.tbs.co.jp/news_sp/tbs-ins... ▼Video provided by "TBS Scoop Post" https://www.tbs.co.jp/news_sp/toukou.... #News #news #TBS #newsdig