Bank of Japan's Declining ETF Funds Leave Investors Guessing Next Move
- Bank sped up purchases during rout in Japan stocks last month
- Annual budget set to be increased, strategist Arai predicts
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On Sept. 8, as the stock market slumped, investors were surprised to find the Bank of Japan, normally a buyer of exchange-traded funds on the Tokyo bourse, absent.
What happened? The central bank, which is authorized to purchase about 3 trillion yen ($25 billion) in equity ETFs a year, is running out of ammunition, having spent 78 percent of its total as of Sept. 7. Because the BOJ usually buys on days the market falls, it sped up amid a rout in the Topix index.