BOJ Debating How to Keep Policy Sustainable, Reduce Side Effects
- Weak inflation indicates stimulus is needed for much longer
- Bond yields, yen move on speculation about possible changes
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As the clock counts down to the Bank of Japan’s July 31 policy announcement, officials are looking for ways to keep their stimulus program sustainable while reducing the harm it causes in markets and to the profitability of commercial banks.
Recent media reports suggest the gathering could deliver anything from allowing for a more natural rise in long-term interest rates to no change with a mere assurance that policy makers are considering the side effects.