Intra-day Market Moving News and Views on Japan
15 Apr 2015 02:06GMT
OECD just released its economic outlook statements on Japan, that the BoJ must continue buying assets aggressively to sustainably achieve its 2% inflation target, while keeping an eye on risks, such as disrupting the bond market and fuelling asset bubbles, the OECD said on Wednesday.
The global think tank also warned that without a credible plan to rein in its huge public debt, Japan may face a bond market sell-off that could hit banks with huge bond holdings.
Aggressive purchases by the BOJ, which now holds a quarter of Japan's gov't bond market, have kept borrowing costs low but that will not last indefinitely, leaving the country vulnerable to rising interest rates, the OECD said.
"The outlook for the gov't bond market will be more uncertain once the BOJ achieves its inflation target" n phases out its quantitative and qualitative easing (QQE) stimulus programme, it said in report on recommendations for Japan.
The Paris-based body estimated that without further fiscal reforms, Japan's gov't debt will exceed 400% the size of its economy by 2040, double the current ratio.
15 Apr 2015 02:06GMT
OECD just released its economic outlook statements on Japan, that the BoJ must continue buying assets aggressively to sustainably achieve its 2% inflation target, while keeping an eye on risks, such as disrupting the bond market and fuelling asset bubbles, the OECD said on Wednesday.
The global think tank also warned that without a credible plan to rein in its huge public debt, Japan may face a bond market sell-off that could hit banks with huge bond holdings.
Aggressive purchases by the BOJ, which now holds a quarter of Japan's gov't bond market, have kept borrowing costs low but that will not last indefinitely, leaving the country vulnerable to rising interest rates, the OECD said.
"The outlook for the gov't bond market will be more uncertain once the BOJ achieves its inflation target" n phases out its quantitative and qualitative easing (QQE) stimulus programme, it said in report on recommendations for Japan.
The Paris-based body estimated that without further fiscal reforms, Japan's gov't debt will exceed 400% the size of its economy by 2040, double the current ratio.
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