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BOJ gets extra innings just to hit a single

19 1 0

NEW YORK - Haruhiko Kuroda is miles from where he wants to be. About 200 miles (320 km).

That’s the distance from Tokyo to Nagoya, where the Bank of Japan governor gave a very upbeat speech last year. Some interpreted those remarks as laying the groundwork for a shift from the ultra-accommodation that’s been the central bank’s trademark.

In terms of monetary policy, Nagoya might as well be on another continent. That’s how much the outlook for interest rates, globally, has shifted. Talk of normalization, however gradual, is now passe. If anything, the question among observers has become when and how the BOJ will ease further.

The central bank doesn’t have stacks of ammunition up its sleeve and officials are conscious of the squeeze negative rates put on some lenders. Playing for time appears to be the approach the BOJ is adopting. Time to see how severe this global soft patch is, whether China can bounce, and whether Washington and Beijing reach a detente on........

© The Japan Times