Tinker, Tailor, Soldier On: Takeaways From the BOJ's Policy Review
Japan’s central bank didn’t change much in its three-month assessment, but Kuroda managed to buy himself some wriggle room, while convincing markets he stands ready to ease.
Loosely speaking.
Photographer: Koichiro Tezuka/The Mainichi NewspapersHaruhiko Kuroda really, really wants you to believe he isn't remotely finished juicing Japan's economy.
The Bank of Japan wrapped up a three-month review of its policy Friday with some tweaks to its approach. It will allow the yield on 10-year government bonds to move 25 basis points on either size of the bank’s zero target, a slightly wider range than investors assumed previously. (In a testy exchange with reporters after the announcement, Kuroda emphasized that the band had not been widened; rather, the policy was merely clarified.) The benchmark interest rate will remain at minus 0.1%, though officials won’t hesitate to cut deeper into negative territory if necessary. Officials emphasized they expect easing to be prolonged. They also ditched the bank’s 6 trillion yen ($55 billion) guide for annual purchases of exchange-traded funds, while keeping an upper limit of 12 trillion yen so the BOJ can step in if sentiment sours.