Shinzo Abe’s Fiscal Stimulus Talk Puts Onus on Bank of Japan to Ease

Prime Minister Shinzo Abe’s promise of a hefty fiscal stimulus package has effectively forced the Bank of Japan (BOJ) to come up with matching monetary ammunition at the close of its two-day meeting on Friday.

A report by news agency Jiji that Abe had revealed a 28 trillion yen ($265 billion) injection, which Reuters estimates at 6 percent of Japan’s economy, surprised markets as many anticipated Tokyo would announce a fiscal package only sometime next week. The earlier-than-expected news now put the onus on BOJ Governor Haruhiko Kuroda to ensure coordinated fiscal-monetary expansion, according to the bulk of strategists.


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Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam