Can digital currencies enhance monetary policies? BOJ Governor doubtful

Bank of Japan Deputy Governor Masayoshi Amamiya said on Saturday it was doubtful whether central banks could enhance the effectiveness of their monetary policies by issuing digital currencies.

Some academics have said central banks could overcome the “zero lower bound” - a situation in which they lose tools to stimulate the economy once interest rates fall to zero - by issuing digital currencies.

In theory, digital currencies would allow central banks to more easily charge interest on deposits of households and firms, thereby nudging them to spend rather than hoard money.

Amamiya countered the idea, saying that charging interest on digital currencies would