The Bank of Japan has continued to ease monetary policy on a large scale, but last month it could no longer ignore market distortions and abruptly revised its previous easing measures.
This year will be a milestone year when Governor Kuroda will be in office in April, and the focus will be on what kind of policy response will be taken based on the effects and side effects of large-scale easing.
Since April last year, the consumer price index has exceeded the 2% target set by the Bank of Japan for eight consecutive months, but the Bank of Japan has indicated that it will continue to implement large-scale easing, saying that it is not accompanied by a rise in wages. .
On the other hand, market distortions such as the decline in the functioning of the bond market as a side effect of continuing to buy large amounts of government bonds to curb rising interest rates can no longer be ignored. Increased width limit.
Governor Kuroda explained that this was not an intention to raise interest rates or tighten monetary policy, but the market widely accepted that it was a de facto monetary tightening. The price has risen to the yen level.
This year, Governor Kuroda will reach his term in office in April, but among market players, the side effects of large-scale easing, trends in the financial markets, and the thinking behind the new regime may cause the BOJ to move to revise its easing measures again. There is also a view that it is not.
Under these circumstances, the focus will be on how close the economy is to achieving its 2% inflation target with wage increases, and what policy measures the BOJ will take.