TRENDING:

BOJ holds 43.5% of all outstanding Japanese government debt

BOJ's massive government bond holdings indicate there is little room for further stimulus.
The central bank may have a hard time weakening Yen in future.

The Bank of Japan (BOJ) now holds a staggering 43.5% of all outstanding Japanese government debt, Jeroen Blokland, Portfolio Manager for the Robeco Multi-Asset funds, Robeco ONE and Robeco Pension Return Portfolio, tweeted on Thursday.

The central bank unleashed a massive quantitative easing program in April 2013. Under the QE plan, the Bank of Japan (BoJ) vowed to buy ¥7 trillion of government bonds each month using electronically created money.

The QE program is in its sixth year. Even so, the BOJ remains miles away from its 2% inflation target.

If anything, the QE program seems to have distorted markets. Also, with BOJ owning more than 43% of government debt, there is limited scope for further monetary stimulus.

Put simply, the BOJ is going to have a tough time battling bullish pressures around the JPY during the next round of risk aversion.

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD recovers above 1.1600 as USD upswing fizzles

EUR/USD trims losses and recovers above 1.1600 in the European session on Monday. The US Dollar upswing loses steam, even as risk sentiment remains in a softer spot and markets continue to scale back on December Fed rate cut expectations, lending support to the pair.

GBP/USD rebounds toward 1.3200 as US Dollar struggles

GBP/USD is looking to extend its rebound toward 1.3200 in European trading on Monday. The pair capitalizes on a pause in the US Dollar rebound, while Pound Sterling buyers remain unnerved amid UK fiscal concerns. Focus shifts to central bank talks amid tepid market mood.

Gold sticks to negative bias below $4,100 amid USD uptick, reduced Fed rate cut bets

Gold remains depressed for the third straight day, though it lacks bearish conviction and manages to hold above a one-week low touched on Friday. A slew of influential FOMC members showed little conviction for reducing borrowing costs, prompting traders to scale back their expectations for another interest rate hike by the US Federal Reserve.

Can Bitcoin, Ethereum and Ripple hold key support levels?

Bitcoin Ethereum, and Ripple begin the week on a cautious note, trading near their respective support levels. Market sentiment remains fragile following last week’s volatility, with BTC, ETH, and XRP correcting by nearly 10%, 14%, and 7%, respectively.

Week ahead: US schedule awaited – Fed minutes, CPI and flash PMI on tap [Video]

Canada, Japan and the UK to publish CPI data, but not the US. US October jobs and inflation reports may never get released. New release schedule likely; FOMC minutes eyed in meantime. Flash PMIs to be watched amid renewed economic worries

Pi Network Price Forecast: PI recovers amid new Pi App Studio updates

Pi Network (PI) trades above $0.2200 at press time on Monday, sustaining the 3.52% gains from Sunday. The announcement of Pi App Studio updates on Thursday aligns with the three-day recovery in PI token, with bulls aiming towards the 50-day Exponential Moving Average.