The Wall Street Journal (WSJ) carried a piece today on the BOJ’s easing efforts, citing that the central bank’s monetary policy program isn’t able to fight the deflationary pressures.
Key Points:
“The belief that deflation will continue has become so ingrained it has presented seemingly insurmountable challenges to monetary policy, a lesson for other countries that are traveling a similar path”
Japan remains definitively stuck
Japan is nearly four years into a Central Bank stimulus effort involving printing trillions of yen and guiding interest rates into negative territory, perhaps the globe's most aggressive such efforts under way
In November, Mr. Kuroda postponed his goal of reaching 2% inflation, all but admitting he is out of ideas.
He said in a series of speeches last year that an entrenched "deflationary mind-set" stifled hope that wages or prices will rise, limiting the impact of monetary policies such as negative rates.
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