Japanese Quantitative Easing Expanded by JPY 11 Trillion
November 2, 2012
Faced with mounting signs that Japan is heading for a new recession and dissatisfied that the yen had not depreciated more sharply, Bank of Japan officials raised their ceiling on quantitative easing by another 11 trillion yen to a total of 91 trillion yen. The ceiling is to be reached by end-2013. 26 trillion yen of asset purchases are planned for next calendar year, 13 trillion yen in each half. The interest rate target has been at zero to 0.1% since early October 2010.
The Bank of Japan Board updates its growth and price forecasts each July, as well as in October, January and April. The table below gives the evolution of these projections. Projected growth in the current and next fiscal years was revised downward, and officials expect GDP to rise only 0.6% in FY14. Core CPI inflation will hover near zero this fiscal year and next.
| 01/11 | 04/11 | 07/11 | 10/11 | 01/12 | 04/12 | 07/12 | 10/12 | |
| GDP | ||||||||
| FY12 | +2.0% | +2.9% | +2.9% | +2.2% | +2.0% | +2.3% | +2.2% | +1.5% |
| FY13 | +1.5% | +1.6% | +1.7% | +1.7% | +1.6% | |||
| FY14 | +0.6% | |||||||
| Core CPI | ||||||||
| FY12 | +0.6% | +0.7% | +0.7% | 0.1% | 0.1% | +0.3% | +0.2% | -0.1% |
| FY13 | +0.5% | 0.5% | +0.7% | +0.7% | +0.4% | |||
| FY14 | +2.8% |
Copyright 2012, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Bank of Japan
ShareThis
