BoJ Preview: Plumbing the depths of negative interest rates – RBS

Jin Kenzaki, Senior Economist at RBS, suggests that even after the BoJ’s “comprehensive assessment”, they expect only fine-tuning of inflation targets and the framework for quantitative and qualitative easing with negative interest rates.

Key Quotes

“In light of the recent inflation situation, we also foresee steps towards additional easing. Specifically, the approach likely to be chosen will take into account financial institution profitability, without making limits to quantitative easing superfluous and avoiding any impression of a pullback in monetary easing. However, if Governor Kuroda is intent on a surprise, there is some small possibility of a shift to targeting long-term rates.”