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Tuesday, January 22

22nd Jan - Special: Bank of Japan


Might add to this later.

Previously on MoreLiver’s:

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MAINSTREAM


Revolutionary Japan is suddenly the centre of world affairsThe Telegraph
So Japan may not slide into genteel oblivion after all. To the surprise of the Japanese people, their country is smack in the middle of two riveting dramas that threaten to upturn the global strategic landscape in short order. (couple of days old piece)

Bank of Japan makes boldest attempt yet to lift economy Reuters
The Bank of Japan announced on Tuesday its most determined effort yet to end years of economic stagnation, saying it would switch to an open-ended commitment to buying assets next year and double its inflation target to 2 percent.

BOJ Adopts Abe’s 2% Target in Commitment to End DeflationBB
The Bank of Japan made its strongest commitment yet to end two decades of stagnation, shifting to Federal Reserve-style open-ended asset purchases while disappointing investors by delaying the program until next year.

Yen Rallies After BOJ Delays Open-Ended Asset Buying Until 2014 BB
The yen rallied from near its weakest level in more than 2 1/2 years after the Bank of Japan said it will conduct open-ended asset purchases from next year, disappointing investors who expected bolder action now.

No Taboos for BOJ Contender Muto in Japan Deflation Fight BB
Former Bank of Japan Deputy Governor Toshiro Muto said that all policy options should be available to the central bank as it looks to turn around more than a decade of falling prices.
  
Japan government panel: need to achieve primary budget surplus Reuters
Japan's government should stick with fiscal discipline targets that aim to return the budget to a primary surplus by fiscal year 2020 to ensure trust in public finances, a leading government panel said on Tuesday.

Japan government welcomes BOJ easing steps towards 2 percent inflationReuters
Japanese Finance Minister Taro Aso said on Tuesday that the government highly appreciated the Bank of Japan's decision to switch to an open-ended commitment to buying assets next year and double its inflation target to 2 percent.

Shares hit 20-month high as Japan promises open-ended easingReuters
World shares hit a new 20-month high on Tuesday after Japan's central bank promised to pump unlimited stimulus into the country's economy to fight the threat of deflation and generate growth.


BLOGS & BANKS

Japan Unveils Extensively Priced In "Open-Yended" Monetization News ZH

Japan: Catharsis Or Crisis? ZH
Overall, Goldman believes the recent developments suggest a still positive outlook for Japanese assets despite their recent run, but it’s clear that promises will need to continue to translate into action - and some very difficult longstanding issues will need to be addressed - in order to sustain the recent positive momentum over the medium-to-longer term.

Wild swings and roundabouts courtesy of the BoJalphaville / FT
The Nikkei rose as much as 1 per cent after the BoJ announcement, and then fell nearly as much before recovering somewhat:

Has BoJ policy changed THAT much?alphaville / FT
For all Shinzo Abe’s talk of urgency in meeting the new 2 per cent inflation target, the BoJ itself doesn’t actually expect it to happen that quickly. In the forecasts accompanying today’s statement, the BoJ has maintained the 2013 CPI forecast of 0.4 per cent made back in October — which is probably fair enough as the open-ended programme doesn’t actually start until next year — and only moved its 2014 up to 0.9 per cent from 0.8 per cent.

Japan 2.0 (and that’s a target, mind)alphaville / FT
Remember how Richard Koo was saying last week that inflationary expectations are actually far more widespread in Japan these days than deflationary expectations? And people fear inflation more than deflation?


Japan: inflation target raised but less easing than expectedDanske Bank (pdf)