Interest rates on term instruments and lending rates have declined further (Chart 11). As a whole, firms’ funding costs through bank loans and the issuance of CP and corporate bonds have declined to record low levels. Moreover, long-term bond yields have been declining steadily. In particular, the yields on JGBs up to three years have declined and flattened.
The problems we are currently facing, including the banking problems, came onto the surface after and as a result of the currency crisis beginning in mid 1997. The magnitude of the currency crisis perhaps has not been matched by any other countries in modern time.