The Bank of Japan (BOJ) is evaluating its exit strategy from its stimulus program, with a particular focus on the future of its exchange-traded funds (ETFs) purchases. Governor Kazuo Ueda has stated that the central bank will review whether to continue its purchases of risky assets, such as ETFs, once it consistently achieves its 2% inflation target. Additionally, BOJ's Uchida highlighted that the overnight call rate is expected to move within a 0.0% range before the introduction of negative rates and that excess reserves incurred 0.1% interest prior to negative rates. Uchida also noted that adjustments to the Yield Curve Control (YCC) would allow for greater yield movement while ensuring bond buying remains stable. Uchida is planning a communication strategy for bond buying post-YCC adjustments and is considering options for the BOJ's significant ETF holdings. Furthermore, Uchida pointed out that Japan Real Estate Investment Trusts (J-REITs) present a separate issue that requires further consideration. The BOJ anticipates that service prices will rise in tandem with wage increases and believes that ceasing ETF and J-REIT buying will not have a significant impact on the markets. Uchida stressed the need for careful communication and market operations to prevent financial market disruptions.
🔴 BOJ GOVERNOR UCHIDA EXPECTS SERVICE PRICES TO RISE ALONGSIDE WAGE INCREASES
*BOJ'S UCHIDA: NO BIG MKT IMPACT EVEN IF BOJ STOPS BUYING ETFS let's find out
🔴 BOJ'S UCHIDA CONSIDERS OPTIONS FOR LARGE ETF HOLDINGS WHILE J-REITS PRESENT A SEPARATE ISSUE REQUIRING FURTHER CONSIDERATION.
🔴 BOJ'S UCHIDA: STOPPING ETF AND J-REIT BUYING WON'T HAVE SIGNIFICANT IMPACT ON MARKETS
🔴 BOJ'S UCHIDA: ADJUSTMENT TO YCC TO ALLOW FOR GREATER YIELD MOVEMENT, BOND BUYING TO REMAIN STABLE
🔴 BOJ'S UCHIDA PLANS COMMUNICATION STRATEGY FOR BOND BUYING AFTER YCC ADJUSTMENTS
🔴 BOJ SEES OVERNIGHT CALL RATE MOVE WITHIN 0.0% RANGE BEFORE NEGATIVE RATES INTRODUCTION
🔴 BOJ'S UCHIDA: EXCESS RESERVES INCURRED 0.1% INTEREST PRIOR TO NEGATIVE RATES; OVERNIGHT CALL RATE RANGED FROM 0-0.1%
🔴 BOJ'S UCHIDA: COMMUNICATION AND MARKET OPERATIONS TO AVOID FINANCIAL MARKET DISRUPTIONS
🔴 BOJ'S UCHIDA EXPECTS NO SIGNIFICANT CHANGES
BOJ to examine fate of ETF buying upon stimulus exit -Gov Ueda https://t.co/gz5LUJbfRz
⚠️ BOJ TO EXAMINE FATE OF ETF BUYING UPON STIMULUS EXIT -GOV UEDA (Reuters) Bank of Japan Governor Kazuo Ueda said on Tuesday the central bank will examine whether to continue its purchases of risky assets, as well as other stimulus means, when sustained achievement of its 2%… https://t.co/EUZWGju4U0