TOKYO, Dec. 11, 2017 /PRNewswire/ - Mizuho DKB Brokerage have commented on the Bank of Japan as it has expressed their opinion that the bank had to increase its stimulus program to touch the target price early, in order to avoid the negative consequences of an extended easing policy.
Mizuho DKB Brokerage research and analysis team found several reports that it was too early to think about an exit move from the significant stimulus measures. The bank's decision to maintain the monetary policy at a stable pace is its main priority.
Todays favorable conditions in the global economy should push the Bank of Japan to act now to reach the 2% inflation target because a prolonged stimulus approach can hurt the banks and leave BoJ without enough instruments to address the next potential crisis.
"I think we should not exaggerate with the stimulus measures, as this may create an imbalance in the local markets" said Michael Green, Head of Corporate Trading at Mizuho DKB Brokerage.
"Yes – in the short-term, the inflation can be achieved with the Bank of Japan's approach, but we should keep the economy stable in the long-term." added Chris Hunter, Director of Corporate Equities at Mizuho DKB Brokerage.
However, the rest of the board members of the Bank of Japan are on the other side of the line, calling for an ease of stimulus measures.
According to the policy framework established in 2016, the Bank of Japan has set the short-term interest rates at -0.1% and the ten-year government bond yield at 0%.
While the majority of the board members decided to maintain the current levels, Kataoka showed disagreement in September and October of this year, calling for specific measures that would reduce 15-year bond yields to -0.2%. He believes that this approach would support the economy and push the inflation up.
About Mizuho DKB Brokerage: Mizuho DKB Brokerage (MDB) is a leading global wealth management company that services the needs of private individuals and corporate institutions. Headquartered in Tokyo, Japan since 2004 with a research department situated in Shanghai, Mizuho DKB Brokerage has accumulated over $6.7 billion U.S Dollars of assets under management.
SOURCE Mizuho DKB Brokerage