Japan’s monetary policy in a challenging environment

Sayuri Shirai ()

Eurasian Economic Review, 2014, vol. 4, issue 1, 3-24

Abstract: The Bank of Japan (BOJ) is attempting to overcome the mild deflation that has lasted in Japan for nearly 15 years and to achieve its 2 % price stability target. In the face of the zero lower bound on short-term interest rates, the BOJ introduced nonstandard monetary easing policy called quantitative and qualitative monetary easing (QQE) to achieve the target. So far, a number of positive outcomes have materialized. Compared with 2012, stock prices have been higher; private consumption is more resilient; more active real estate investment are taking place; and the yen’s exchange rate has been at more depreciated levels. Most importantly, the growth momentum of the economy is gaining traction and the unemployment rate is approaching the pre-crisis lowest level. There are some signs of the economy moving out of deflation although the BOJ needs some time to reach the 2 % target. This paper highlights the main features of QQE with conceptual explanations by reviewing the previous major monetary easing policies: quantitative monetary easing adopted in 2001–2006 and comprehensive monetary easing introduced in 2010 but was replaced with QQE in April 2013. Copyright Eurasia Business and Economics Society 2014

Keywords: Japan; Quantitative and qualitative monetary easing; Signaling effect; Forward guidance; E52; E58 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
http://hdl.handle.net/10.1007/s40822-014-0006-1 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:eurase:v:4:y:2014:i:1:p:3-24

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/40822

DOI: 10.1007/s40822-014-0006-1

Access Statistics for this article

Eurasian Economic Review is currently edited by Dorothea Schäfer

More articles in Eurasian Economic Review from Springer, Eurasia Business and Economics Society Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().