BOJ's Kuroda on Policy to Control Yield Curve

The video discusses the control of long-term interest rates by central banks post-Lehman crisis, focusing on the Bank of Japan's (BOJ) strategies. It explains the use of quantitative easing (QE) and negative interest rates to manage the yield curve, particularly the 10-year Japanese Government Bonds (JGBs). The BOJ aims to maintain interest rates around 0% to stimulate the economy and achieve a 2% inflation target. The video also addresses market perceptions of tapering and emphasizes the BOJ's commitment to an accommodative monetary policy to ensure economic stability.

What was the primary goal of central banks' intervention in the long-term asset market post-Lehman crisis?

• To increase inflation to 5%

• To reduce long-term interest rates

• To stabilize currency exchange rates

• To increase short-term interest rates

What is the Bank of Japan's target for long-term interest rates?

• Around 2%

• Around 5%

• Around 0%

• Around -1%

Under what condition might the BOJ allow long-term interest rates to rise?

• If inflation reaches 2%

• If unemployment falls below 4%

• If the yen depreciates significantly

• If GDP growth exceeds 3%

What concern do markets have regarding the BOJ's sale of JGBs?

• It could be perceived as tapering

• It might lead to a currency crisis

• It could increase inflation to 5%

• It may cause a stock market crash

What is the BOJ's stance on the continuation of the 80 trillion yen JGB purchase program?

• It will continue to maintain a smooth yield curve

• It will be doubled to 160 trillion yen

• It will be stopped immediately

• It will be reduced gradually

What is the primary focus of the BOJ's shift to yield curve control?

• To increase short-term interest rates

• To maintain an accommodative monetary policy

• To reduce government debt

• To stabilize the stock market

How does the BOJ plan to address the real economy and financial market situation?

• By gaining flexibility through yield curve control

• By reducing government spending

• By increasing taxes

• By increasing interest rates