Tokyo - Arabstoday
The Bank of Japan is likely to ease monetary policy on Friday by boosting asset purchases by up to ten trillion yen (Dh451 billion) and in doing so may extend the maturity of government bonds it targets to around three years, according to sources familiar with the central bank\'s thinking. The action, which would be the central bank\'s second easing in just over two months, would serve to show the BoJ\'s determination to overcome deflation and reach the one per cent inflation target adopted at its February meeting. The central bank has been under constant pressure from politicians to do more to rev up the world\'s third biggest economy, and BoJ policymakers have signalled their readiness to provide more stimulus. But there is no consensus yet within the central bank on whether it should increase its 30 trillion yen asset-buying programme by the usual five trillion yen increment, or by double that amount — as it did in February — for greater market effect. If it were to opt for a bigger increase, the BoJ may also extend the maturity of government bonds it buys under the programme to around three years from the current two-year duration, said the sources who spoke on condition of anonymity. What appears to be certain is that the BoJ will ease on Friday. But there seems to be various views on by how much, so that will be a close call,\" one of the sources said. The BoJ now pledges to meet the 30 trillion yen target for asset purchases by the end of this year, but may extend that deadline by about six months if it were to boost the programme, the sources said.