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2014年11月 4日 (火)

社説:日銀の追加緩和 泥沼化のリスク高まる

November 01, 2014(Mainichi Japan)
Editorial: More monetary easing at BOJ risks slide into economic chaos
社説:日銀の追加緩和 泥沼化のリスク高まる

The Bank of Japan (BOJ), the country' central bank, has further eased its monetary grip. The move comes 18 months after the BOJ took unprecedentedly large-scale monetary easing steps as the "first arrow" of Abenomics, an economic policy mix promoted by the government of Prime Minister Shinzo Abe. Moreover, the latest round of monetary easing coincided with end of the U.S.'s own quantitative relaxation program.
Financial markets reacted sharply to the move, with the yen diving and share prices spiking.

However, the BOJ was pressured to implement additional monetary easing steps because its ultra-easy money policy, adopted in April 2013 by newly appointed BOJ Gov. Haruhiko Kuroda, had not proven sufficiently effective. One cannot help but doubt whether the reinforcement of measures that had not produced the desired results the first time round will brighten prospects for steady economic growth. Moreover, the central bank's latest round of monetary relaxation is, so to speak, a dangerous drug that could produce serious side-effects.

Under the scenario of the "first arrow," the government and the BOJ projected that their goal of 2 percent annual inflation would be achieved and the economy pulled out of its slump if the money supply from the central bank doubled over a two-year period. In other words, the government and the BOJ attempted to convince the public that consumer prices would rise by dramatically increasing the money supply.

True, consumer prices gradually increased, but the rise has slowed down because the fall in the yen's value has not produced sufficient results and oil prices have declined. The first arrow has not led to a virtuous cycle in which higher spending on factories, equipment and consumer goods increases corporate profits and wages, which in turn expand consumption.

The BOJ ended up implementing additional monetary easing steps on a step-by-step basis. This is very much like the central bank's policy under the governorship of Masaaki Shirakawa, though Kuroda had criticized his predecessor's measures as ineffective in overcoming deflation.

In the meantime, the BOJ's massive purchases of government bonds as part of its ultra-easy money policy have adversely affected the domestic bond market. Especially bonds that are due to mature shortly are in extremely short supply, causing abnormal situations such as negative interest.

Despite these circumstances, the BOJ further eased its monetary grip. If the yen becomes weaker -- aided partly by the end of U.S. quantitative relaxation -- the prices of imported goods will rise, which would squeeze household budgets further.

Through the latest monetary easing steps, the BOJ will increase the amount of long-term government bonds the central bank buys annually by 30 trillion yen to some 80 trillion yen. If investors were to believe that the BOJ accepts a huge amount of the government's debts, international confidence in Japan would be lost, causing the market prices of government bonds to plummet and rates of long-term interest on such bonds to rise, which could throw Japan's economy into chaos.

Despite the latest additional monetary easing steps, the BOJ predicts that next fiscal year's inflation rate will be 1.7 percent, falling short of the 2 percent target. As the BOJ has repeatedly eased its monetary grip, the central bank could find it increasingly difficult to find an exit ramp out of the policy, as the U.S. has just done. Moreover, concerns have been raised that the implementation of such abnormal monetary policy measures could be prolonged.

The BOJ has ventured deeply into a dangerous area that it should not, as the central bank, have entered in the first place.

毎日新聞 2014年11月01日 02時33分


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