News hitting the wires and hitting the yen too 22 April
Further to my previous post Bloomberg sources reporting that having adopted a negative interest rate on some excess reserves the BOJ may now be considering helping them lend by offering a negative rate on some loans.
- any discussion could happen in conjunction with any decision to make a deeper cut to the current negative rate on reserves
- BOJ's Stimulating Bank Lending Facility, which now offers loans at 0%, would be the most likely vehicle for this option.
The SBLF, created in 2013, had extended JPY 24.4trln as of April 10. The initiative is separate to the main BOJ easing tool which targets an expansion in the monetary base, mainly through the purchase of govt bonds.
BOJ next meeting takes place 27-28 April with the consensus that further stimulus will be introduced.
Yen pairs sharply higher on the breaking news as USDJPY takes out the strong offers/res at 110.00 to trigger stops to 110.18 before retreating back to 109.95.
Nikkei jumped to highs of 17562.70. Currently 17488.58, +0.72%
