Comments by BOJ governor, Haruhiko Kuroda
- Increase in pace of ETF purchases is due to market risk aversion
- -0.10% rate is not a limit, could still go lower
- Cutting interest rates can be done if needed
- Can also increase bond purchases if needed
- Believes that virus impact will continue for some time
- Believes that economy will return to recovery
There is little doubt that their move today is in part to show solidarity among central banks to stick with coordinated global easing, but once again this isn't a crisis that is best deal with by monetary policy.
And even more so when the likes of the BOJ and ECB are mainly just trying to paper over the cracks by addressing liquidity strains in the market for the most part.
Don't get me wrong, it is definitely needed but this is a real test of the BOJ's resolve and their "bluff" that they can pursue negative rates even deeper from hereon. And even so, how much lower can they go and how effective will that even be?
