Trying to Make Sense of the Bank of Japan's Monetary Policy since the Exit from Quantitative Easing
In this short note, I review the Bank of Japan (BOJ)'s monetary policy since its exit from the so-called quantitative easing regime early in 2006. The major characteristic of the policy stance during the period, called Strategy 2 below, has been to adjust the policy interest rate gradually upward in response to a healthy real economy despite stagnant behaviour in consumer prices. Such a policy stance can be contrasted with a hypothetical strategy, Strategy 1, whereby the BOJ would have kept the policy rate at lower levels, possibly at 0%, until inflation starts to show an upward trend more clearly. The two strategies are compared on many fronts with particular attention to well-known recent empirical regularities about inflation - a smaller response of inflation to output and larger uncertainties about the response. Various comparisons of the two strategies offered here, although far from conclusive, tend to support Strategy 1 over Strategy 2. In my discussion of the two strategies, I also comment on some of the major features of the Nishimura article in this issue. Copyright 2007 Blackwell Publishing Ltd
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 10 (2007)
Issue (Month): 3 (December)
|Contact details of provider:|| Web page: http://www.blackwellpublishing.com/journal.asp?ref=1367-0271|
|Order Information:||Web: http://www.blackwellpublishing.com/subs.asp?ref=1367-0271|
When requesting a correction, please mention this item's handle: RePEc:bla:intfin:v:10:y:2007:i:3:p:301-316. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing)or (Christopher F. Baum)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.