The Bank of Japan says there is no possibility of helicopter money, and by a strict definition they are correct. But as the government plans to issue more 40-year bonds, it is looking more and more like some monetization of debt is underway.
The BOJ says as long as it buys Japanese government bonds (JGB) from the market, it is not directly underwriting bonds to fund government spending.
However, that distinction has become blurred as investors buy bonds only to take profits by selling them immediately to the bank – a transaction coined the “BOJ trade.”
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