BOJ Brings Change of Philosophy to Monetary Policy

The transcript discusses the Bank of Japan's shift from quantitative to price targeting, which affects the yen's strength and reduces the push towards riskier assets. It explores the impact of these changes on FX volatility and yield curves in Japan, Europe, and the US. The discussion highlights the BOJ's influence on other central banks and the limited effect on inflation expectations. The BOJ's flexible approach to tapering is seen as a solution to ongoing challenges, with implications for the Federal Reserve's future actions.

What is the primary focus of the BOJ's recent monetary policy shift?

• Reducing interest rates further

• Increasing quantitative easing

• Strengthening the yen through exports

• Targeting inflation rates

How does the BOJ's policy change affect FX volatility?

• It increases volatility significantly

• It suppresses volatility slightly

• It causes extreme fluctuations

• It has no impact on volatility

What is a key factor driving FX volatility according to the second section?

• China's economic growth

• European Central Bank policies

• Japan's inflation rates

• US interest rates

What challenge is the BOJ facing regarding its purchase rate?

• Maintaining the current purchase rate for a longer period

• Increasing the purchase rate significantly

• Eliminating the purchase rate altogether

• Reducing the purchase rate immediately

When is the Federal Reserve expected to implement a rate hike?

• December

• November

• January

• September