(Bloomberg) — The Bank of Japan should review its yield curve control program under its incoming governor, a former top finance ministry official said ahead of the central bank’s first leadership change in a decade.
Most Read from Bloomberg
Warner Bros. Nears Deal for Harry Potter Online TV Series
China’s Yuan Replaces Dollar as Most Traded Currency in Russia
Google Wants You to Never Overpay for a Flight Again
Jamie Dimon Warns US Banking Crisis Will Be Felt for Years
Credit Suisse Chairman ‘Truly Sorry’ for Failure to Stem Crisis
The ongoing monetary easing has caused side effects including distortions in the bond market, a drop in the currency and a weakening of fiscal discipline, according to Takehiko Nakao, a former Vice Minister for International Affairs. He stressed the need for the policy tweak while also noting that such a move will also come with risks.
“The yield curve control should be reviewed, even if that results in short-term shocks,” Nakao said in an interview Monday. He didn’t specify the preferred timing or detailed process for the review. “This can’t go on forever.”
Academic Kazuo Ueda will be replacing Haruhiko Kuroda as governor of the BOJ this weekend, and faces the thorny problem of what to do with a complicated policy framework that has resulted in the buying of assets larger than the size of Japan’s economy. Nakao’s calls for a policy adjustment add to a majority of economists expecting change from the BOJ by June, according to a survey conducted around a month ago.
Nakao, who now chairs Mizuho Research & Technologies, suggested multiple uncertainties exist for incoming governor Ueda. One of them is a series of recent banking crises that have heightened financial insecurity worldwide.
“Now the BOJ needs to take into account the stability of the financial sector, as well as monetary policy in the US and Europe, when it reconsiders its own policy,” Nakao said.
Still, the former senior MOF official said it’s unlikely that Japanese financial institutions will find themselves in the same situation as Credit Suisse Group AG, due to the more limited number of Japanese banks, strict supervision practices and banks’ relatively conservative business models.
Nakao also suggested Japan’s recent price developments are another factor that could complicate Ueda’s monetary policy steering.
It’s unclear whether tightening is necessary to counter inflation, or if inflationary pressures aren’t as strong as they appear, Nakao said. He said that Japan’s current price gains are driven by higher import costs and not by wage hikes, echoing the central bank’s latest view.
Nakao also criticized the expanding expectations for monetary policy, which is now viewed as a solution to a wide range of problems from growth, prices to climate change.
Monetary policy has been seen as “a cure-all,” said Nakao. “That thinking’s created all sorts of problems.”
–With assistance from Toru Fujioka.
Most Read from Bloomberg Businessweek
The Undercover Organizers Behind America’s Union Wins
Why Cheaper Insulin Today Risks Higher Costs Later
A Giant Rail Merger Escapes Washington’s Big Deal Crackdown
Paris’s Air Taxi Stations Could Be Ready Before the Taxis Are
US and Europe Wrangle Over Green Subsidies to Avoid a Trade War
©2023 Bloomberg L.P.
(Bloomberg) — The fashion for retro has hit financial markets: stagflation playbooks from the 1970s are back.Most Read from BloombergOPEC+ Makes Shock Million-Barrel Cut in New Inflation RiskSwiss Prosecutors Probe Credit Suisse Deal, Job Cuts SeenBillionaire Blocked From His New Palace Blasts ‘Socialist’ IndiaRussia Blames Ukraine as Suspect Held in War Blogger’s DeathOil Surges Most in a Year After OPEC+’s Shocking Production CutThat’s because the latest shock move by oil producers to restric
(Bloomberg) — WeWork Inc. said it’s offering to swap two sets of bonds worth about $1.2 billion for new debt and stock as part of a sweeping restructuring effort. Most Read from BloombergOPEC+ Makes Shock Million-Barrel Cut in New Inflation RiskSwiss Prosecutors Probe Credit Suisse Deal, Job Cuts SeenBillionaire Blocked From His New Palace Blasts ‘Socialist’ IndiaRussia Blames Ukraine as Suspect Held in War Blogger’s DeathOil Surges Most in a Year After OPEC+’s Shocking Production CutThe compan
(Bloomberg) — Former senior officials at digital-asset exchange Gemini are rolling out a token backed by US Treasury Bills with around 5% yield in response to a gulf in returns between traditional finance and decentralized crypto lending. Most Read from BloombergOPEC+ Makes Shock Million-Barrel Cut in New Inflation RiskWarner Bros. Nears Deal for Harry Potter Video SeriesSwiss Prosecutors Probe Credit Suisse Deal, Job Cuts SeenBillionaire Blocked From His New Palace Blasts ‘Socialist’ IndiaOil
Australia's central bank takes center stage on Tuesday with its latest interest rate decision, and beyond that, if the second trading day of the quarter is as eventful as the first, then investors' plates will be extra full. Oil prices posted the biggest rise in a year on Monday following a surprise output cut from OPEC+ over the weekend, a slump in U.S. bond yields in the wake of recession-level manufacturing sector data and a steep slide in Tesla shares after sluggish sales growth figures. Wall Street took the 'bad news is good news' position on that, however: lower yields and implied interest rates, coupled with buoyant energy stocks, ensured the Dow and S&P 500 closed in the green – the Dow rising 1%.
(Bloomberg) — China Evergrande Group said it’s clinched an offshore restructuring deal with a key creditor group, laying a cornerstone in the property developer’s debt-overhaul road. Most Read from BloombergWarner Bros. Nears Deal for Harry Potter Online TV SeriesChina’s Yuan Replaces Dollar as Most Traded Currency in RussiaGoogle Wants You to Never Overpay for a Flight AgainJamie Dimon Warns US Banking Crisis Will Be Felt for YearsA Kingdom Built on Oil Now Controls the World’s Climate Progres
China's top lenders should enhance risk management practices and be more sensitive to macroeconomic fluctuations, senior Chinese banking officials said, in response to a global banking sector crisis that has roiled financial markets. The collapse of Silicon Valley Bank (SVB) suggests banks should strictly abide by the regulatory requirements and measures of risk management, Xie Xiaoxue, from China Construction Bank Corp's (CCB) credit management department, said.
When it comes to Social Security, age 67 is considered full retirement age. But it hasn't always been that way. Originally, the Social Security Act of 1935 set the retirement age at 65 years old. The age increased to 67 … Continue reading → The post How Advisors Handle an Ever-Changing Retirement Age appeared first on SmartAsset Blog.
Investment firms that lend to healthcare companies are fielding increased interest from entrepreneurs as the banking crisis unfolds. New York-based life sciences firm Catalio Capital Management makes venture-capital investments and backs publicly traded companies. In November, Catalio said it had raised more than $85 million for its first special-situations fund, a vehicle targeting debt and structured-equity deals for small and midsize private companies.
GM, Hyundai and other auto makers report a robust start to the year, due in large part to rising inventory levels and easing supply-chain troubles.
Stock markets offer one of the great paradoxes of life – that when conditions grow difficult and prices fall, opportunities for profit will appear. For investors, it’s a chance to cash in – after a proper look into the nuts and bolts behind a market decline. As always with stocks, informed decisions are the most likely to pan out. To jumpstart that due diligence, we can check in with Wall Street’s analysts. These are the pros, the equity experts who’ve built their reputations learning and analyz
Pan American Silver (PAAS) completes the much-awaited acquisition of Yamana Gold, which will boost its silver by 50%.
Consider these important factors before investing in bonds and CDs.
Gold prices are headed toward record highs Tuesday—and they might not stop there. At $2,042 an ounce—up 2.1% on Tuesday—the gold price has less than 1.5% to rise to hit its record high of $2,069.40 set in 2020. Gold prices are typically driven by three factors.
(Bloomberg) — C3.ai Inc. fell the most ever in a single day after short-seller Kerrisdale Capital alleged “serious accounting and disclosure issues” at the enterprise software developer.Most Read from BloombergWarner Bros. Nears Deal for Harry Potter Online TV SeriesToronto-Dominion Becomes Biggest Bank Short With $3.7 Billion on the LineChina’s Yuan Replaces Dollar as Most Traded Currency in RussiaRead the New York Felony Indictment Against TrumpJamie Dimon Warns US Banking Crisis Will Be Felt
C3.ai fell stock after Kerrisdale Capital, which holds a short position in AI stock, said it has sent a letter to the software maker's auditor.
(Bloomberg) — Sweden’s biggest pension fund Alecta has put its equities chief on leave and announced a plan to reduce risk exposure after reporting $2 billion in investment losses tied to last month’s US banking crisis. Most Read from BloombergWarner Bros. Nears Deal for Harry Potter Online TV SeriesChina’s Yuan Replaces Dollar as Most Traded Currency in RussiaToronto-Dominion Becomes Biggest Bank Short With $3.7 Billion on the LineJamie Dimon Warns US Banking Crisis Will Be Felt for YearsStock
HOUSTON (Reuters) -Exxon Mobil Corp's Low Carbon business has the potential to generate hundreds of billions of dollars in revenue and outperform the company's traditional oil and gas as soon as a decade from now, CEO Darren Woods said. The largest U.S. oil producer on Tuesday laid out to investors the aims of its emerging energy transition strategy in a meeting with Wall Street. Exxon is tackling what should be a multi-trillion market in 10 years or more, Woods said.
(Reuters) -Walmart Inc on Tuesday said it expects about 65% of its stores to be serviced by automation by the end of its fiscal year 2026, just days after revealing plans to lay off more than 2,000 people at facilities that fulfill online orders. The announcement, amid the U.S. retail giant's annual investor meeting in Tampa, Florida, comes as Walmart increasingly uses its huge stores to handle online-order deliveries and invests heavily in automation to speed up order processing at its e-commerce fulfillment facilities.
In the latest trading session, Tesla (TSLA) closed at $192.58, marking a -1.12% move from the previous day.
The iPhone maker has been increasing its dividend for the last 10 years—and slashing share count for the last five. Expect both to continue when Apple reports March-quarter earnings.