• Abenomics in Japan

    Posted on 9 April, 2013 by Robert Pullan in Economics, Investments.

     

    JGB yields are approaching the lows of 2003. The lowest close from 12 June 2003, on the day after Work and Pensions secretary Andrew Smith bolted the stable door with the horses inside, was a yield of 0.44% on the 10 year. There was no causation one way or the other between this UK pension scheme action and worldwide yields which all bottomed next day and then reversed. However, Abenomics could happen in the UK.

    Apparently (I have read varying descriptions of the market action) the 10 year JGB intra-day yield late last week went much lower than 0.44% and then doubled for the day! But I think the 0.44% close is still the lowest close.

    On April 4th the Bank of Japan indicated it would try to double the monetary base within two years. For a look at Japanese exchange rate and equity action from that date to the date of publication and yield history for longer periods please see http://pullantrustees.com/wp-content/uploads/2013/04/JapanApr13.pdf.

    And here is a direct link to the actual April 4th Bank of Japan announcement http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf.

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