News eDaily12 Jun 2017

Japan:Life insurers ask about exit strategy for monetary stimulus

12 Jun 2017

The head of Japan's life insurance association has called on the central bank, the Bank of Japan (BOJ), to begin debating as soon as possible a future exit strategy for its ultra-easy monetary policy, even though an actual withdrawal of stimulus could be some time away, reported Reuters.

Growing signs of life in Japan's economy have presented the BOJ with a communication challenge, pushing it to be clearer with markets on how it might dial back its stimulus without scaring investors that such a move is imminent.

"The BOJ shouldn't be afraid of revising (its exit strategy) in the future and openly debate the subject now, paying heed to market voices," Mr Akio Negishi, Chairman of the Life Insurance Association of Japan, told a news conference last week.

BOJ officials say they hope to convince markets they have a credible exit strategy in mind, without giving out details on concern doing so too soon could confuse markets.

Mr Negishi said that through good dialogue, the BOJ can avoid causing market confusion.

"We hope the BOJ releases (details of an exit strategy) with clear, meticulous explanation" that could avoid causing market confusion, he said.

 

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