Free Trial

(U2) More Stable But Still Fragile


Trend Structure Remains Bullish


Cautious Risk Appetite Gains Momentum


Key Support Still Exposed


Late Equity Roundup: 2W Highs

Real-time Actionable Insight

Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.

Free Access
(MNI) Tokyo

There is insufficient evidence that the Bank of Japan's latest policy decision to allow the ten-year JGB yield to fluctuate in a range 25 bps either side of zero percent has any material impact on boosting capital investment, a former chief economist at the central bank told MNI.

Recent analysis by bank staff on the impact was 'in depth' but there are doubts over the accuracy due to the errors that can arise from the use of estimates, Toshitaka Sekine, professor at the School of International and Public Policy at Hitotsubashi University, said in an interview.

The BOJ confirmed a permitted trading range for the 10-year JGB yield in its March policy statement, making an implicit market understanding official. The decision was taken largely on research that suggested monetary action had limited impact on business fixed investment, "except when the range of fluctuations in 10-year JGB yields over the preceding six months exceeds 50 basis points."

In previous policy reviews, including the September 2016 one, there was little clear evidence that increasing money or quantity was meaningful and the BOJ should clarify its latest analysis through additional working papers, increasing the understanding of its position.

Sekine hopes bank staff can foster a broader understanding of policy by disclosing details of their analysis showing that the tolerated 10-year yield range hasn't had a significant impact on capex.

MNI Tokyo Bureau | +81 90-2175-0040 |
MNI Tokyo Bureau | +81 90-2175-0040 |

To read the full story

Why Subscribe to

MNI is the leading provider

of news and intelligence specifically for the Global Foreign Exchange and Fixed Income Markets, providing timely, relevant, and critical insight for market professionals and those who want to make informed investment decisions. We offer not simply news, but news analysis, linking breaking news to the effects on capital markets. Our exclusive information and intelligence moves markets.

Our credibility

for delivering mission-critical information has been built over three decades. The quality and experience of MNI's team of analysts and reporters across America, Asia and Europe truly sets us apart. Our Markets team includes former fixed-income specialists, currency traders, economists and strategists, who are able to combine expertise on macro economics, financial markets, and political risk to give a comprehensive and holistic insight on global markets.