BOJ May Hit Bond Purchase Limit in 2017 – Ex-BOJ Deputy Governor Iwata
BOJ May Hit Bond Purchase Limit in 2017 – Ex-BOJ Deputy Governor Iwata
Former BOJ deputy governor Kazumasa Iwata said in a
Bloomberg interview published on Wednesday, that the central bank will
reach its bond buying limit by mid next year, which will make negative
interest rates policy a key tool for the BOJ.
Key Quotes:
As for how low is appropriate, minus 0.7 percent, or if you want to have some room, it would be around a negative 1 percent
That’s
what I personally think that the BOJ will "ultimately" shift the rate
to negative 1 percent, without indicating whether this would be done in
one or several steps
The BOJ just introduced a negative interest rate in January, so this is the time to gauge how its impact will spread
There
is a limit to expanding bond purchases, so I expect they will cut the
current minus 0.1 percent rate sometime in the future
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