Permission required for reusing or reproducing
CCBS Chief Economists’ Workshop
Bank of England, 20-22 May 2014
Impacts of Quantitative and Qualitative
Monetary Easing (QQE) upon Japan’s
Economy and Prices
- one year’s experience -
Seisaku Kameda
Head of Economic Research Division
Bank of Japan
Outline
A. QQE : Japan’s Monetary Policy since last April
B. Responses in Financial Markets
C. Effects on the Real Economy
D. Effects on the Price Front
1
A. QQE : Japan’s Monetary Policy since last April
2
A- QQE
1. Features of QQE
(1) Massive Purchases of JGBs
320
tril. yen
QQE announcement
280
240
End-2014
270 tril.yen
Monetary base
End-2013
202 tril.yen
Amount outstanding of the Bank's JGB holdings
190
tril.yen
200
160
142 tril.yen
120
80
40
0
CY 07
Source: Bank of Japan.
08
09
10
11
12
13
14
15
3
A- QQE
2. Features of QQE
(2) Dual Strong Commitments
•
The Bank will achieve the price stability target of
2 percent at the earliest possible time, with a time
horizon of about 2 years.
•
The Bank will continue with the QQE as long as it is
necessary for maintaining that target in a stable
manner.
4
A- QQE
3. Features of QQE
(3) Flexibility
•
The forward guidance implied in the QQE is
state-contingent, or economic condition-based,
but does not depend on a specific economic indicator
like the unemployment rate.
•
The Bank will thoroughly examine both upside and
downside risks to economic activity and prices, and make
adjustments as appropriate.
5
A- QQE
4. Features of QQE
(4) Coordination with the Government Policy
- Joint Statement in January 2013 • The Bank of Japan conducts monetary policy based on the
principle that the policy shall be aimed at achieving price stability.
•
The Government will not only flexibly manage macroeconomic
policy but also formulate measures for strengthening
competitiveness and growth potential of Japan's economy.
•
In addition, in strengthening coordination between the Government
and the Bank of Japan, the Government will steadily promote
measures aimed at establishing a sustainable fiscal structure with
a view to ensuring the credibility of fiscal management.
6
A- QQE
5. Three Transmission Channels of QQE
(1) Asset Prices Channel
Lowering risk premia of various asset prices including
long-term interest rates
(2) Portfolio Rebalance Channel
Enhancing investment in risk assets in the private sector
(3) Expectations Channel
Raising people’s inflation expectations
7
B. Responses in Financial Markets
8
B- Responses in Financial Markets
1. Rise in Stock Prices
180
Jan. 2005=100
180
Japan (Nikkei 225 Stock Average)
United States (Dow Jones Industrial Average)
Europe (EURO STOXX)
160
160
140
140
120
120
100
100
Target of 2%
announcement
80
80
QQE
announcement
60
CY05
06
Source: Bloomberg.
07
08
09
10
11
12
13
14
12/ 10 13/ 1
4
7
10 14/ 1
60
4
9
B- Responses in Financial Markets
2. Depreciation of the Yen
180
70
150
Depreciation
of the yen
140
160
80
130
Appreciation
of the yen
140
120
90
120
110
100
100
100
90
110
Yen/U.S. dollar (left scale)
80
Yen/U.S. dollar
Yen/euro (left scale)
Real effective exchange rate of the yen (right scale, CY2010=100)
60
120
CY 0 5
0 6
0 7
0 8
0 9
1 0
1 1
1 2
1 3
14
80
Yen/euro
12/ 10 13/1
4
7
10 14/ 1
Note: Figures for real effective exchange rate of the yen are based on the broad index of the BIS effective exchange rate.
The figure for April 2014 has been calculated using the monthly average of the BOJ's nominal effective exchange rate (the Yen Index).
Sources: Bloomberg; BIS.
70
4
10
B- Responses in Financial Markets
3. Stability in Long-Term Interest Rates
6
%
%
3.5
Japan
United States
5
3.0
Germany
2.5
4
2.0
3
1.5
2
1.0
1
0
CY05
0.5
Testimony by
Chairman
Bernanke
06
07
08
09
Sources: Japan Bond Trading Co., Ltd.; Bloomberg.
10
11
12
13
14
12/
13/
10
1
4
7
14/
10
1
0.0
4
11
B- Responses in Financial Markets
4. Factors behind Long-Term Interest Rates
%
2.0
1.8
Depressing
Factor
Purchase of JGBs
by BOJ
1.6
1.4
1.2
LongTerm
Interest
Rate
＝
Expected
Short-Term
Interest
Rates
＋
Risk
Premium
1.0
0.8
0.6
Rising
Factor
Improvements in
outlook for economic
activity and prices
0.4
10-year forward rate 3 years from now
0.2
spot rate
0.0
12/10
Source: Bloomberg.
13/01
13/04
13/07
13/10
14/01
14/04
12
B- Responses in Financial Markets
5. Decline in Real Interest Rates
4
%
4
3
3
2
2
1
1
0
0
-1
-1
-2
-2
Inflation-indexed JGB (old, the longest maturity)
Inflation-indexed JGB (old, 10 year)
JGB (5 year) - Inflation swap (5 year)
-3
%
-3
Inflation-indexed JGB (new, 10 year)
-4
-4
CY 05
06
Source: Bloomberg.
07
08
09
10
11
12
13 14
CY 05
06
07
08
09
10
11
12
13 14
13
B- Responses in Financial Markets
6. Money and Credit
Money Stock and Bank Lending
10
y/y % chg.
Financial Position of Enterprises
36
32
M2
8
DI
"Easy"
28
Lending by domestic commercial banks
24
6
"Tight"
Large enterprises
Small enterprises
20
16
4
12
8
2
4
0
0
-4
-2
-8
-12
-4
-16
-20
-6
-24
-8
CY 95
97
99
Source: Bank of Japan.
01
03
05
07
09
11
13 14
-28
CY 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 14
14
B- Responses in Financial Markets
7. Changes in Asset Portfolios of Private Sectors
Households and
Nonfinancial Corporations
(tril.yen)
-40
-20
0
20
Commercial Banks
Insurance and Pension Funds
(Depository Corporations)
40
-60
-30
0
30
-10
60
Bond, etc.
Bond, etc.
Bond, etc.
Shares
Shares
Shares
Deposits
Loans
Loans
Outward
investment
Deposits with
the BOJ
Outward
investment
-5
0
5
10
Note: Figures indicate the cumulative flows from 2013/Q1 to 2013/Q4 recorded in “Flow of Funds Accounts.”
Source: Bank of Japan.
15
C. Effects on the Real Economy
C-1. The First Round Effect:
Direct Effects from the Rise in Asset Prices
16
C-1 Effects on the real economy (1)
1. Recovery Led by Domestic Demand
Private Consumption
320
Public Demand
s.a., ann., tril. yen
130
310
125
300
120
290
115
280
110
CY0 5 0 6
100
07
s.a., ann., tril. yen
08
09
10
11
12
s.a., ann., tril. yen
CY0 5 0 6
13
07
08
09
10
11
12
13
12
13
Business Investment
Exports
80
90
s.a., ann., tril. yen
75
80
70
70
65
60
60
50
CY0 5 0 6
07
08
09
10
11
12
13
CY0 5 0 6
07
08
09
10
11
Note: In each chart, the broken line indicates the level for 2008/Q1, when real GDP recorded its peak just before the Lehman shock.
Source: Cabinet Office.
17
C-1 Effects on the real economy (1)
2. Wealth Effect in Private Consumption
Wealth Effect Simulation
2.0
deviation from the baseline, %
Propensity to Consume by Age
140
Total effect
%
130
Direct effect
1.5
120
110
1.0
CY 2000
CY 2005
CY 2013
100
90
0.5
80
70
0.0
-1
0
1
2
3
4
5
6
7
8
9
10 11 12
quarters
60
age - 2524
29
3034
3539
4044
4549
5054
5559
6064
6569
70+
Note: Response of private consumption to a 30 percent rise of TOPIX.
Simulation based on Q-JEM.
Sources: Ministry of Internal Affairs and Communications, etc.
18
C-1 Effects on the real economy (1)
3. Improvements in Business Confidence and Profits
Large Manufacturing Enterprises
30
%
DI
10
20
8
10
6
0
4
-10
2
-20
0
-30
-2
-40
-4
-50
-6
-60
-70
-80
CY 00
Business conditions
("favorable" - "unfavorable," left scale)
06
08
Sources: Bank of Japan; Ministry of Finance.
10
%
DI
5.0
10
4.5
0
4.0
-10
3.5
-20
3.0
-30
2.5
-40
2.0
-50
CY 00
1.5
-10
-12
04
20
-8
Ratio of current profits to sales
(right scale)
02
All Nonmanufacturing Enterprises
12
14
02
04
06
08
10
12
14
19
C-1 Effects on the real economy (1)
4. Effects of Yen’s Depreciation on Exports
Increase in Foreign Visitors
(Exports of Services)
Real Exports of Goods
10
change from 2012/Q1 , %
3.5
Overseas economies factor
Overseas economies factor
Real effective exchange rate factor
3.0
Other factors
5
annualized change from 2009/Q1, millions
Real exports
2.5
Real effective exchange rate factor
Other factors
2.0
0
1.5
1.0
-5
0.5
0.0
-10
12/Q2
3
4
13/1
2
3
4
Note: An estimated decomposition. Other factors include structural changes
caused by the shift to overseas production and the decrease in non-price
competitiveness.
Sources: Ministry of Finance; Bank of Japan; IMF; JNTO, etc.
12/Q1
2
3
4
13/1
2
Note: An estimated decomposition. Other factors include structural changes
caused by the easing of visa requirements and the introduction of visa
exemptions.
20
C-1 Effects on the real economy (1)
5. Real Interest Rate Gap and Investment Activities
Output Gap and
Real Interest Rate Gap
-8
Cross Correlations between Real
Interest Rate Gap and Fixed Investment
%
reversed, %
8
0.8
Real interest rate gap (left scale)
-6
6
0.6
-4
4
0.4
-2
2
0.2
0
0
0
2
-2
-0.2
4
-4
-0.4
6
-6
-0.6
8
CY83 86
-8
-0.8
Output gap (right scale)
89
92
95
98
01
04
07
10
13
Notes: 1. Real interest rate gap = Real short-term interest rate
- Potential growth rate (1 year ahead)
Notes: 2. Real short-term interest rate = Overnight call rate
- CPI less fresh food (y/y % chg., 1 year ahead)
Sources: Cabinet Office, etc.
Real Interest rate gap
←Leading
Lagging→
Private Residential Investment
Private Non-Residential Investment
-12 -10
-8
-6
-4
-2
0
2
4
6
8
10 12
quarters
21
C-2. The Second Round Effect:
the Knock-on Effect on Employment
and Households’ Income
22
C-2 Effects on the real economy (2)
1. Transition in the Mechanism of Business Cycles
Ratio of Domestic Demand to Nominal GDP
Notes:1. Shaded areas indicate recession periods.
2. Figures up through 1979 are on the 1990 base.
Figures from 1980 up through 1993 are on the 2000 base.
Figures from 1994 onward are on the 2005 base.
Source: Cabinet Office.
23
C-2 Effects on the real economy (2)
2. Relative Strength of Labor Market Indicators
Industrial Production
120
Unemployment Rate
CY 2010=100
3
reversed, %
115
110
105
4
100
95
90
5
85
80
75
CY 9 8
00
02
04
06
08
10
12
14
6
CY 9 8
00
02
04
06
08
10
12
14
Note: Shaded areas indicate recession periods. The broken line indicates the level of the latest peak/bottom.
Sources: Ministry of Economy, Trade and Industry; Ministry of Internal Affairs and Communications.
24
C-2 Effects on the real economy (2)
3. Responses to Consumption and Export Shocks
Manufacturing
Real Value-Added
14
Nonmanufacturing
Real Value-Added
deviation from the baseline, % points
12
10
8
6
4
Comsumption shock
2
Export shock
0
1
3.5
2
3
4
5
6
7
Employment
8
1
9
10
quarters
deviation from the baseline, % points
2
3
4
5
6
Employment
7
8
9
10
quarters
7
8
9
10
quarters
deviation from the baseline, % points
0.8
3.0
0.6
2.5
2.0
0.4
1.5
0.2
1.0
0.0
0.5
-0.2
0.0
1
2
3
4
5
6
7
Note: Impulse responses from an estimated VAR.
deviation from the baseline, % points
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
8
9
10
quarters
1
Sources: Cabinet Office; Ministry of Finance; Ministry of Internal Affairs and Communications.
2
3
4
5
6
25
C-2 Effects on the real economy (2)
4. Improvements in Employment and Income Situation
Labor Force Participation Rates
75
s.a., %
s.a., %
Workers’ Income
50
3
%
Number of workers
Male (left scale)
Female (right scale)
49
74
2
Average wages of fulltime workers
48
73
1
Average wages of parttime workers
47
72
46
71
0
Effect of rises in
proportion of part-time
workers
-1
Workers' income: change
from 2011/Q4 to 2013/Q4
70
CY 0 6
45
07
08
09
10
11
12
-2
1 3 14
Note: Q4 represents December-February here.
Sources: Ministry of Health, Labour and Welfare; Ministry of Internal Affairs and Communications.
26
D. Effects on the Price Front
D-1. The First Stage:
Inflation due to the Rise in Import Prices
27
D-1 Effects on the Price Front (1)
1. Rise in Import Prices reflecting Yen’s Depreciation
Import Prices and
CPI less Fresh Food
170
160
150
CY2010 = 100
CY2010 = 100
IPI (yen basis, left scale)
CPI (all items less flesh foods, right scale)
Penetration of Imported Goods
Capital goods
110
Consumption goods
109
108
140
107
130
106
120
105
110
104
100
103
90
102
80
101
70
100
60
99
50
98
CY 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14
2000-04
2005-09
2010-14/Q1
10
15
20
20 5
%
%
Note: Import penetration ratio = imports / domestic shipments and imports
5
10
15
Sources: Ministry of Internal Affairs and Communications; Bank of Japan; Ministry of Economy, Trade and Industry.
28
D-1 Effects on the Price Front (1)
2. Energy Prices in CPI
10
y/y % chg.
Implied direction given
current levels of foreign
exchange rates and oil prices
8
6
4
2
0
Petroleum products
-2
Electricity and Gas, manufactured & piped
CPI Energy
-4
12/Jan.
Apr.
Jul.
Oct.
13/Jan.
Source: Ministry of Internal Affairs and Communications.
Apr.
Jul.
Oct.
14/Jan.
Apr.
Jul.
29
D-2. The Second Stage:
Inflation due to the Improvement
in the Output Gap
30
D-2 Effects on the Price Front (2)
1. Widespread Increase of Consumer Prices
CPI less Food and Energy
1.0
y/y % chg.
70
%
0.8
65
0.6
60
0.4
55
0.2
50
0.0
45
-0.2
40
-0.4
35
-0.6
30
-0.8
25
-1.0
20
CY 06
2013/Mar.
2014/Mar.
Number of Increasing and
Decreasing Items in CPI
07
08
09
10
11
12
13
14
Durable goods
Semi/Non-durable goods
Ratio of increasing items
Public services
House rent, private & imputed rent
Ratio of decreasing items
Other services
CPI (all items less food and energy)
Source: Ministry of Internal Affairs and Communications.
Note: Proportion of items whose indices increased/decreased from a year earlier.
All items less fresh food.
31
D-2 Effects on the Price Front (2)
2. Pass-through of Import Costs: Past and Present
40
%
%
30
FY2008 1st half
FY2008 2nd half
FY2013 1st half
FY2013 2nd half
4
3
20
2
10
1
0
0
-10
-1
IPI
(contract currency basis)
IPI
(yen basis)
CPI energy
Sources: Bank of Japan; Ministry of Internal Affairs and Communications.
CPI food
CPI
(less food and energy)
32
D-2 Effects on the Price Front (2)
3. Wage Inflation (1)
Japan
35
US
Hourly wage, y/y % chg.
Hourly wage, y/y % chg.
10
1970's
1970's
1980's
1980's
30
1990's
25
1990's
8
2000-
2000-
20
6
15
4
10
5
2
0
-5
0
0
2
4
6
Unemployment rate, %
3
6
9
12
Unemployment rate, %
Source: “An Empirical Study on the New Keynesian Wage Phillips Curve: Japan and the US,” Bank of Japan Working Paper Series, 14-E-4.
33
D-2 Effects on the Price Front (2)
4. Wage Inflation (2)
Japan
Estimation Results
of NKW Philips Curve
1972-91
1973-92
1974-93
1975-94
1976-95
1977-96
1978-97
1979-98
1980-99
1981-00
1982-01
1983-02
1984-03
1985-04
1986-05
1987-06
1988-07
1989-08
1990-09
1991-10
1992-11
1993-12
1.0
0.8
0.6
0.4
0.2
0.0
-0.2
-0.4
-0.6
-0.8
-1.0
-1.2
1972-91
1973-92
1974-93
1975-94
1976-95
1977-96
1978-97
1979-98
1980-99
1981-00
1982-01
1983-02
1984-03
1985-04
1986-05
1987-06
1988-07
1989-08
1990-09
1991-10
1992-11
1993-12
α1
1.0
0.0
-1.0
-2.0
-3.0
-4.0
-5.0
-6.0
-7.0
-8.0
-9.0
US
 Hourly Waget 

log 
Hourly
Wage
t 4 

Unemployment ratet
  0  1
100
 CPIt 1 

  2 log 
CPI
t 5 

0
1.5
1.2
1.0
0.8
0.6
0.4
0.2
0.0
-0.2
-0.4
α2
0.5
0.0
-0.5
1972-91
1973-92
1974-93
1975-94
1976-95
1977-96
1978-97
1979-98
1980-99
1981-00
1982-01
1983-02
1984-03
1985-04
1986-05
1987-06
1988-07
1989-08
1990-09
1991-10
1992-11
1993-12
-1.0
1
2
0.069
-1.560
0.396
(12.48)
(-11.46)
(4.72)
Adj-R 2
0.800
United States
0
1972-91
1973-92
1974-93
1975-94
1976-95
1977-96
1978-97
1979-98
1980-99
1981-00
1982-01
1983-02
1984-03
1985-04
1986-05
1987-06
1988-07
1989-08
1990-09
1991-10
1992-11
1993-12
1.0
Japan
1
2
0.028
-0.191
0.529
(10.04)
(-4.49)
(17.56)
Adj-R 2
0.697
Note: The estimation periods are
1980/Q1-2013/Q2. t-values
in parentheses.
Note: Rolling window is 20 years. Shaded area indicates the range of two standard errors.
Source: "An Empirical Study on the New Keynesian Wage Phillips Curve: Japan and the US," Bank of Japan Working Paper Series, 14-E-4.
34
D-3. The Third Stage:
Inflation due to the Rise in Inflation Expectations
in Medium- to Long Terms
35
D-3 Effects on the Price Front (3)
1. Surveys on Inflation Expectations in Medium- to Long Terms
2.5
%
Market Participants
2 to 10 years ahead
2.0
2.5
1.5
1.0
1.0
0.5
0.5
0.0
0.0
2011/Dec.
2.5
6 to 10 years ahead
2.0
1.5
Economists
%
2012/Dec.
2014/Apr.
2011/Oct.
Households
%
2.5
Over the next 5 years
2.0
2.0
1.5
1.5
1.0
1.0
0.5
0.5
0.0
0.0
2011/Dec.
2012/Dec.
2014/Mar.
%
2012/Oct.
2014/Apr.
Enterprises
5 years ahead
2014/Mar.
Notes: 1. The survey to market participants for April 2014 asked respondents to include the effects of scheduled consumption tax hikes.
2. The surveys to households and enterprises for March 2014 asked respondents to exclude the effects of scheduled consumption tax hikes.
Sources: Bank of Japan; QUICK, etc.
36
D-3 Effects on the Price Front (3)
2. Changes in Distributions
of Households’ Inflation Expectations
15
Density (%)
Density (%)
15
16
Density (%)
2013
2012
12
10
10
8
5
5
4
0
0
0
-10
-5
0
5
5-year expectations
1-year expectations
10
15
-10
-5
0
5
10
15
-10
-5
0
5
10
15
5-year expectations (%)
Respondents who knew about the "price
stability target"
Respondents who had not heard of the
target
Note: Circles indicate the mean of each distribution.
Source: S. Nishiguchi, J. Nakajima, and K. Imakubo, 2014, “Disagreement in Households‘ Inflation Expectations and Its Evolution,”
Bank of Japan Review Series 2014-E-1, Monetary Affairs Department, Bank of Japan.
37
D-3 Effects on the Price Front (3)
3. Shifts in Economists’ CPI Forecast
1.5
Fiscal
2013
y/y % chg.
1.0
0.5
CPI less fresh food (actual figures in the latest month)
0.0
-0.5
13/Apr.
1.5
Fiscal
2014
13/Jul.
13/Oct.
14/Jan.
14/Apr.
y/y % chg.
1.0
Economists' Forecast of Fiscal 2014
0.5
BOJ Forecast of Fiscal 2014
0.0
-0.5
13/Apr.
Sources: JCER; Bank of Japan.
13/Jul.
13/Oct.
14/Jan.
14/Apr.
38
D-3 Effects on the Price Front (3)
4. Existing Literature on the Formation of Inflation Expectations
Japan
Authors
Nakayama and Oshima (1999)
Tsuruga and Muto (2008)
Data
Consumer Confidence Survey
Consumer Price Index, Output Gap
Weights
Estimation Periods
Backward-looking
Forward-looking
1971/Q2-1982/Q4
35%
65%
1983/Q1-1999/Q2
43%
57%
1971/Q2-2005/Q1
46%
54%
United States
Authors
Data
Weights
Estimation Periods
Backward-looking
Forward-looking
Michigan Survey
1966/Q2-1995/Q4
22-30%
70-78%
Livingston Survey
1957/Q2-1995/Q2
21-38%
62-79%
Galí and Gertler (1999)
GDP Deflator, Unit Labor Cost
1960/Q1-1997/Q4
23-38%
62-77%
Roberts (2001)
GDP Deflator, Output Gap
1957/Q1-1997/Q4
47-67%
33-53%
Kurmann (2007)
GDP Deflator, Output Gap
1960/Q1-1997/Q4
45%
55%
Roberts (1998)
39
D-3 Effects on the Price Front (3)
5. Term Structure of Inflation Expectations
(1) Target
Inflation
Rate
(4) Trend Inflation Rate
- Defined as the ultra long-term expected
inflation rate ("anchor" of expectation)
- Not necessarily coincides with the target
inflation rate
Term
Structure
for period
t+1
(2) Expected Inflation Rate
- Formed by:
(1) current and past inflation rates (backward-looking)
(2) target inflation rate (forward-looking)
Term
Structure
for period t
0
1 period ahead
2 periods
ahead
…
n periods
ahead
Infinite period
ahead
(3) Actual Inflation Rate
40
D-3 Effects on the Price Front (3)
6. An Estimation of Trend Inflation Rate (1)
TIPS : Trend Inflation Projection System
1
(1)
1
,1
(2)
,
1
,
,
2
1
1
8
8
1
1
forwardlooking
1
backwardlooking
(3)
1
,
,
1
2
,
2
[ Remarks ]
: inflation rate at period
,
,
∗
(1) is so-called Hybrid New Keyensian Phillips Curve
:
periods ahead expected inflation rate of at period
: output gap at period
:
∗
2
- Formed by forward-looking term
periods ahead expected output gap at period
and backward-looking term
: target inflation rate at period
,1
1
(2) formulates the term structure of expected inflation:
By (1), (2) and (3), the trend inflation rate
1
8
lim
→∞
,
is given by
-
periods ahead expected inflation rate is formed by:
(a)
8
1
1
∗
2
1
1 periods ahead expected inflation rate,
(b) past inflation rates (backward-looking), and
1
(c) target inflation rate (forward-looking)
41
D-3 Effects on the Price Front (3)
7. An Estimation of Trend Inflation Rate (2)
Case2: πt*= 1.5 percent (1990/Q1-2012/Q4),
2.0 percent (2013/Q1-2013/Q4)
Case1: πt*= 2.0 percent (1990/Q1-2013/Q4)
3.0
ann. avg., %
3.0
ann. avg., %
Expected inflation rate / 6 to 10 years ahead
2.5
TIPS / 6 to 10 years ahead
2.5
2.0
2.0
1.5
1.5
1.0
1.0
0.5
0.5
0.0
CY 90
95
Source: Bank of Japan, etc.
00
05
10
13
0.0
CY90
95
00
05
10
13
42
Summary
Summary
Asset Prices Channel
Portfolio Rebalance Channel
Economy
First Round Effect
Second Round Effect
Inflation
The First Stage
The Second Stage
QQE
Expectations Channel
The Third Stage
43
APPENDIX
Appendix. BOJ Forecasts of Growth and Inflation
Median of the Policy Board Members’ Forecasts
y/y % chg.
Real GDP
Fiscal 2013
As of April 2013
Fiscal 2014
As of April 2013
Fiscal 2015
As of April 2013
Fiscal 2016
Source: Bank of Japan.
CPI(all items less
fresh food)
Excluding the effects
of the consumption
tax hikes
+2.2
+0.8
+2.9
+0.7
+1.1
+3.3
+1.3
+1.4
+3.4
+1.4
+1.5
+2.6
+1.9
+1.6
+2.6
+1.9
+1.3
+2.8
+2.1
44