Richard Koo: Forward Guidance No longer An Option For BOJ

Bank of Japan Governor Haruhiko Kuroda took the market by surprise two weeks ago when he announced a sharp increase to the nation’s QE program just three days after testifying that the economy was well on its way to target 2% inflation. Nomura Research Institute chief economist Richard Koo says that the orchestrated shock is evidence of Kuroda’s experience with currency interventions, but that it will only make exiting a failed policy that much harder in the future.

Richard Koo – BOJ QE vote split 5-4, bureaucrats v businessmen

“No matter how much the BOJ eases policy during this kind of balance sheet recession, the liquidity it supplies will not enter the real economy as long as there...