What does it mean for Japan to ease monetary policy?

Easy monetary policy (easy monetary policy) is generally to increase the amount of money in the market, such as direct issuance of currency, buy bonds in the open market, reduce the reserve ratio and loan interest rates, etc., the more money needs to be loaned to enterprises and individuals, it is easier to borrow, generally can make the economy develop faster, is to promote prosperity or resist recession measures, such as the release of a large amount of credit is the performance of loose monetary policy.

Benefits: 1. Under the loose monetary policy, the amount of market currency increases, which reduces the cost of capital use and increases profits.

2. Increase the amount of money, increase people's monetary income, and promote consumption.

3. Loose monetary policy is a monetary policy used to promote economic development when the domestic economy is not sluggish.

The Bank of Japan's large-scale monetary easing measures will continue to weaken the yen, which will help push up inflation, but the depreciation of the yen will also cause imports** to rise, which will hurt Japan's manufacturing confidence and be detrimental to wage and consumption growth. Some BOJ policy members believe that maintaining stable economic growth is more important than rushing to achieve the inflation target. Without enough jobs and appropriate wage growth to support it, taking too many steps to raise prices may not be a wise choice and may hurt long-term economic growth.

This situation will stabilize Japan's economic development, and it is also a decision that Japan has to make.

To some extent, if the Bank of Japan chooses to maintain its loose monetary measures, this measure can boost the local economy and further boost local consumption. On the other hand, if the Bank of Japan chooses to raise interest rates aggressively, this approach will hinder the local economy, but it will stabilize the local yen.

Exchange rate. Whether to raise or cut interest rates, the BOJ needs to make difficult decisions. <>

The Bank of Japan will continue to implement accommodative monetary measures.

In order to solve the problems of local economic development, the Bank of Japan decided to continue large-scale monetary easing, which also means that the Bank of Japan will not choose to raise interest rates aggressively. Prior to this, the Bank of Japan does not seem to have chosen to raise interest rates voluntarily, even though the Fed has raised interest rates several times, which has caused the yen to depreciate by about 25%. <>

This situation can stabilize Japan's economic development.

If the Bank of Japan.

If you choose to raise interest rates, this will stabilize the yen's exchange rate, but it will also cause a setback to Japan's economic development. It is for this reason that the Bank of Japan has chosen to maintain loose monetary measures, as it can encourage local economic development and solve the problem of insufficient local consumption power. For many ordinary people, this is true, but the local people have not chosen to take the initiative to raise interest rates, and many ordinary people are not willing to actively consume, which will also be detrimental to the local economic development, so the Bank of Japan has no conditions to take the initiative to raise interest rates at all.

For the Bank of Japan, no matter what the BOJ decides, because Japan's economic development itself is relatively stagnant, and it has also been affected by the pandemic and the Fed's interest rate hikes.

So the outlook for Japan's economic development is not optimistic, and some people may even ** Japan's economic development may fall into recession.

I think this will have a negative impact on the Japanese economy.

The main reason for this is that the yen has already depreciated by more than 20%, which will undoubtedly lead to further depreciation if Japan continues to implement monetary easing measures. On this basis, we should note that Japan's GDP has fallen back to 30 years ago, and the average income of the Japanese population has fallen to about 86% of what it was 30 years ago. This is a very frightening statistic, because it not only means that the standard of living of many people is further reduced, but also that Japan's economy is in decline across the board.

For Japan, after the Fed chooses to raise interest rates, Japan can choose to raise interest rates appropriately, in order to improve economic development, and this way can also avoid more serious inflation problems in Japan. <>

What's going on here?

This is about the monetary measures of the Bank of Japan, which, on the premise of the depreciation of the yen, did not choose to raise interest rates simultaneously, but chose to continue monetary easing. Even though the yen has already depreciated by more than 20%, this situation has affected the stability of Japan's economic development, but Japan has not decided to raise interest rates because of this. <>

This will have a negative impact on Japan's economy.

As far as Japan's economy is concerned, Japan itself is in a state of long-term deflation, and if Japan chooses to raise interest rates further, this situation may lead to a further recession in Japan. Conversely, if Japan chooses to maintain monetary easing, this approach will also lead to further inflation in Japan. On this basis, because the income level of many people is further reduced, high inflation will reduce the quality of life of many people, and even lead to the insolvency of some families.

Finally, regardless of whether Japan raises or cuts interest rates, neither of these measures will be able to solve Japan's own economic development problems.

The Bank of Japan's decision to continue large-scale monetary easing will lead to a reduction in Japanese government bonds**, and if this happens, financial markets will be volatile.

Monetary easing on a scale is necessary to support the Japanese economy's recovery from the downturn caused by the pandemic. Keeping interest rates unchanged. The decision weighed on financial markets. Supporting Japan's continued economic recovery.

This policy has a very big impact on the Japanese economy, because the current economy can no longer support Japan's development.

Summary. At the same time, Japan lags behind China and the United States in industrial R&D investment and technological innovation, and the yen may continue to fall into a downturn.

At the same time, Japan lags behind China and the United States in industrial R&D investment and technological innovation, and the yen may continue to fall into a downturn.

Japan intends to promote depreciation, increase exports, and promote the return of the first to the surplus. Japan's domestic consumption has been weak for a long time, and it can only rely on increasing exports to boost the Japanese economy. Japan's relatively low interest rates could lead to a slower depreciation of the yen.

The depreciation of the yen means that exports will pick up, and the surplus is expected to expand, which can be used to boost the economy by relying on external demand.

The long-term factors for the depreciation of the yen are demographic problems and backward industrial technology. Japan's population has entered negative growth since 2010, and the lack of shelter in Laojia Prefecture has made the problem of aging the working population prominent, and the aging of the population has made it difficult to expand manufacturing capacity and make it difficult for the industry to upgrade its technology. At the same time, Japan's traditional advantages in the electronics industry have been replaced by China and the United States, and Japan's sluggish economy cannot support its continuous investment in high-tech industries.

Japan continues to have an ultra-loose monetary policy. The Bank of Japan (BOJ) has been keeping interest rates low ever since it lowered its benchmark interest rate to February 2016. Japan's ultra-loose monetary policy has kept short-term interest rates at around zero for a long time, and has been able to keep long-term interest rates at around zero through the purchase of long-term government bonds.

After the outbreak of the epidemic, the Bank of Japan stepped up its bond purchases, and Chayama has continued to this day. Although Europe and the United States have gradually signaled that they want to withdraw from easing, the Bank of Japan is still trying to maintain its easing intensity. In March, the Bank of Japan's monetary policy meeting did not say that "Japan is not in a situation where inflation continues to exceed 2%, so it is important to support the economic recovery from the epidemic by maintaining monetary easing."

Japan intends to promote depreciation, increase exports, and promote a return to the annual sales surplus. Japan's relatively low interest rate levels and relatively large interest rate differentials with the United States could contribute to the depreciation of the yen. The depreciation of the hungry exchange rate means that exports will rebound, the surplus is expected to expand, and the economy will be boosted.

Japan's domestic consumption has been weak for a long time, and it can only rely on increasing exports to boost the Japanese economy. At present, the loose monetary policy of Europe and Japan is intended to promote the shrinkage of the currency, expand exports, reduce imports, and promote another surplus.

With inflation in the US and UK above 8% and 9% respectively, the market is not too surprised that Japan's inflation rate is just above 2%. A review of Japan's past CPI growth data shows that the standard inflation rate and the core inflation rate are not normal. The inflation rate is already the highest in Japan; If it rises to 4%, this will be its highest level.

Japan's inflation rate has been rising steadily recently, rising from January to more than 1% in March, closing from 2% in April and is expected to exceed 3% this month. Due to historically low inflation and even deflation, Japan's currency policy is still very loose.

The Bank of Japan voted to maintain its short-term interest rate target at - and promised to guide the 10-year government bond yield at around 0%. The yield curve control will continue to be relaxed until the ** target is achieved, and there will be no hesitation to increase easing, and the CPI may remain around 2% for the time being, after which the increase may be slowed. The Bank of Japan's policy approach remains to maintain its current ultra-loose status.

Bank of Japan Governor Haruhiko Kuroda has seen Japan's CPI data exceed 2%, but due to the inertia of thinking, he does not believe that CPI growth can stabilize above 2% for a long time. The yen has been depreciating, falling to a 24-year low against the dollar. There is widespread speculation that the Bank of Japan may adjust its yield curve control policy, allowing bond yields to rise further to prevent further weakening of the yen and raise the cost of fuel and food imports.

A poll showed that Kishida's approval rating fell 6 percentage points to 60 percent, the lowest level since February. About 69 percent of respondents said they disapprove of Fumio Kishida's approach to inflation and said they were struggling to make ends meet. Japan's economy is recovering, but it is facing downward pressure from commodities and, most importantly, strong monetary easing is needed to truly support economic activity.

Wages need to go further** so that households can absorb larger prices** and inflation can become more sustainable. The yen has depreciated rapidly against the dollar, pushing up the cost of imports. Raw materials have been **, and the weakening of the yen has exacerbated this effect.

This does not mean that the goal has been achieved. There are still downside risks to the economy, and commodities are hurting consumption.

Because the Bank of Japan made it clear that it did not want to affect the exchange rate. So they have been pursuing a loose policy.

It may be because he thinks that this disadvantage can make the entire domestic economy more vigorous, in fact, every country has a policy for each country.

This kind of trouble with China will not have a good result, and Japan and China's wishful thinking is that the economy is hot and the politics cold.