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BoJ’s bazooka surprised the markets – Deutsche Bank

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Dec 18, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Delhi) – David Plank, Macro strategist at Deutsche Bank, notes that the BoJ has surprised the market with its additional stimulus.

    Key Quotes

    “It has announced it will extend the average maturity of its JGB purchases and has added to its ETF buying program. The maturity extension will take the average from 7-10 years until the end of this year to 7-12 years from the beginning of 2016. The intent of this move is to encourage “a decline in interest rates across the entire yield curve.”

    With regard to ETFs Bank “will establish a new program for purchasing ETFs at an annual pace of about 300bln yen……Under this new program, the Bank will purchase ETFs composed of stocks issued by firms that are proactively making investment in physical and human capital….The Bank will commence purchasing ETFs under the new program from April 2016…” There are a number of other new measures, such as extending the application periods for the loan support program and increasing the amount of each J-REIT the Bank can purchase.”
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