Tag Archives: JGB

Bank Of Japan Launches ‘Unprecedented’ $1.4 Trillion Stimulus Package

By The Huffington Post News Editors

* BOJ changes policy target to base money from interest rates
* Combines bond-buying schemes, targets JGBs across curve
* BOJ to double JGB, ETF holdings in 2 years
* Kuroda get unanimous support from BOJ board
* Kuroda says took all steps BOJ could think of
By Leika Kihara and Stanley White
TOKYO, April 4 (Reuters) – The Bank of Japan unleashed the world’s most intense burst of monetary stimulus on Thursday, promising to inject about $1.4 trillion into the economy in less than two years, a radical gamble that sent the yen reeling and bond yields to record lows.
New Governor Haruhiko Kuroda committed the BOJ to open-ended asset buying and said the monetary base would nearly double to 270 trillion yen ($2.9 trillion) by the end of 2014 in a shock therapy to end two decades of stagnation.
The U.S. Federal Reserve may buy more debt under its quantitative easing, but with the Japanese economy about one-third of the size of the United States, the scope of Kuroda’s “Quantitative and Qualitative Monetary Easing” is unmatched.
“This is an unprecedented degree of monetary easing,” a smiling Kuroda told a news conference after his first policy meeting at the helm of the central bank.
“We took all available steps we can think of. I’m confident that all necessary measures to achieve 2 percent inflation in two years were taken today,” he said.
One of those steps was to abandon interest rates as a target and become the only major central bank to primarily target the monetary base — the amount of cash it pumps out to the economy. It adopted a similar policy in 2001-2006, but not on this scale.
The scope of the changes Kuroda pushed through, and the fact he secured unanimous board support for them, drove …read more

Source: FULL ARTICLE at Huffington Post

Japan's Money-Printing Frenzy and Today's Other Important Financial Stories

By John Maxfield, The Motley Fool

Filed under:

After a rough day yesterday, financial stocks are generally higher this morning. The financial stories below help to explain why.

1. Bank of Japan: Let the printing begin!
What’s the best way to get an economy up and going again? According to Japan‘s central bank, the answer is to print copious amounts of money. In the first policy statement since Haruhiko Kuroda took over as the head of the institution, the Bank of Japan outlined what’s being claimed as the most aggressive monetary policy since the Weimar Republic:

The Bank will achieve the price stability target of 2 percent in terms of the year-on-year rate of change in the consumer price index (CPI) at the earliest possible time, with a time horizon of about two years. In order to do so, it will enter a new phase of monetary easing both in terms of quantity and quality. It will double the monetary base and the amounts outstanding of Japanese government bonds (JGBs) as well as exchange-traded funds (ETFs) in two years, and more than double the average remaining maturity of JGB purchases.

Policymakers in Japan have been struggling for nearly two decades to find a solution to the deflation that’s hung over the country’s economy since the early 1990s. In the most recent election, it was a central facet of the new prime minister’s economic policy. And following his inauguration last December, he’s set upon accomplishing this objective by selecting Kuroda to chair the central bank.

According to the bank’s president, “Incremental steps of the kind we’ve seen so far weren’t going to get us out of deflation. I’m certain we have now adapted all policies we can think of to meet the 2 percent price target.” To read more about this, check out The New York Times article here.

2. MF Global Report
Thought you had heard the last about former New Jersey governor Jon Corzine and MF Global’s astonishing collapse? Think again.

This morning, the trustee for the failed commodity company’s bankruptcy issued its long-awaited report on what led to the collapse and how significant the damages were. As The Wall Street Journal noted, the bankruptcy trustee laid the blame squarely at Corzine’s feet, saying that a risky business strategy, inadequate systems, and “negligent conduct” contributed to the company’s unraveling.

“Corzine and his management team failed to strengthen the company’s weak control environment, making it almost impossible to properly monitor the liquidity drains on the company caused by Corzine’s proprietary trading strategy,” the report said. You can read the 124-page report here.

3. Jobs Data
According to data released today by the Labor Department, the number of Americans filing for unemployment benefits last week hit a four-month high. For the week ended March 30, the advance figure for seasonally adjusted initially came in at 385,000, an increase of 28,000 applications over the prior week. According to Reuters, economists had expected the …read more

Source: FULL ARTICLE at DailyFinance