News Headline Summary

Bank of Japan expand size of asset buying and lending programme by JPY 10trl to JPY 101trl


- Is to increase buying of T-bills, JGBs by JPY 5trl each.
- No change to deadline for meeting target for asset buying and lending from end of next year.
- Will review at next meeting its understanding on medium to long term price stability.
- Board member Ishida proposed cutting interest paid to financial institutions' excess reserves parked with BoJ to 0% from 0.1%.
- Ishida's proposal was boted down 8-1.
- Decision to increase asset buying and lending programme was unanimous.
- Japan economy expected to remain weak for time being.
- Japan exports and output have decreased.
- Will continue to pursue powerful easing in continuous manner.
- Judge further easing appropriate to prevent economy from derailed from recovery track.
- Shirakawa instructed BoJ staff to examine issues for discussion on mid to long term price stability at next meeting.
- BoJ is to extend swap agreement with Fed until February 2014.
- BoJ is to offer new loans quarterly until March 2014.

Reaction details (04:15)

- USD/JPY immediately spiked higher by 17 pips from 84.22 to 84.39, however 2 minutes after, this movement has been pared, moving down to session lows, trades 84.00 (-30 pips) last.
- Nikkei 225 immediately moved down by 0.80% but this movement has been quickly pared, currently trading higher at 10,135.00

Analysis details (04:17)

- BoJ's decision to increase JPY 10trl to its asset purchase program is in-line with market expectations.

20 Dec 2012 - 04:01 - Equities Bank Speaker - Source: Newswires

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