BOJ Plans to Exit its QE policy

Raising inflation rates is part of Bank of Japan’s options to stop its Quantitative Easing program according to BOJ’s governor Haruhiko Kuroda. This includes trimming of bonds bought in the past years to stimulate the economic growth. Although he said that it is too soon to say on the next move of BOJ.

Predicaments associated with easing of monetary policies that global central banks facilitated in the past years were brought up. However, Kuroda stated that it is not necessary for BOJ to change their policies since the 2 percent target has not yet been achieved.

On the other hand, most of the analysts predicted that BOJ would ease its stimulus program as early as second half of the year where inflation would gain momentum.They are sanguine that consumer prices will slowly rise towards the 2 percent inflation target. Yet, profit gains are moving in a sluggish manner despite stricter policies in the labor market.