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© 2016 AFPBank of Japan lifts view of economic outlook
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© 2016 AFP
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Wakarimasen
hmmmm. the BoJ has such a sterling record of predicting the future and managing the present. let's believe their every word.
viking68
The BoJ has a hard job of predicting the future thanks to the government and the culture.
How to increase spending when there is a culture willing to accept low bank interest rates on deposits that is laughable. The culture is save instead of spend and not to take out loans, even though the rate of interest is again laughable.
How do you increase spending and inflation when the government includes increases to a spending tax, i.e., JCT?
The Japanese government has put Japan into a bind with the huge debt amounts that prevents it from increasing government spending to act as a stimulus. They have used that lever too many times, and now they are in a corner, i.e., the need to increase taxes and the need to stimulate the economy.
ozellis
Good economic news apparently draws no reaction from JT punters.
fxgai
ozellis, the BOJ saying this or that isn't that good economic news. The recent upturn all comes down to the yen getting dumped for foreign assets in response to the US election result.
viking68, I'm skeptical that government spending works as a stimulus in the best of times but certainly it's been tried and failed in Japan only to add to the huge debts being racked up.
As you note people are saving despite zero returns for doing so. Nothing better to do with the money, and worried about the future.
The government ought to focus on policies that will boost incentives to take risks in pursuit of bigger returns. Policies that will boost economic growth.
That's the missing link. Abe needs to go big on reforms, but the bereaucracy stands in the way and his heart doesn't seem to be in it. Seems to me that the new US administration, despite the 4 year handicap, might end up showing the Japanese how pro-growth policy is done next year. (For now, I have such hopes.)
It's one for the "stupidest thing I ever heard" list. Prices rising isn't what makes people want to spend (except in worse basket cases like Venezuela).
Consumers will spend more if there is real economic growth. Good fiscal and regulatory policy from the government could act to support that, if only there was the will to shake things up. But there isn't.
CoconutE3
BOJ can thank Trump for this lift.