Are Zombie Companies on the Brink of Collapse due to BOJ Rate Hikes?

A concerning trend is emerging in the corporate landscape of Japan as the Bank of Japan (BOJ) begins tightening its monetary policy. This shift threatens to pull the rug out from under many struggling firms, often referred to as “zombie companies”—businesses that generate just enough revenue to keep their operations afloat while failing to meet their long-term debt obligations. Recent insights suggest that we may be witnessing the beginning of a significant wave of bankruptcies among these weak entities, driven by rising interest rates.

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