Deutsche Securities: BOJ may adjust its description of the degree of monetary easing

Odaily Planet Daily News Deutsche Securities believes that the Bank of Japan is at a "critical communication crossroads" and needs to decide whether to maintain the current forward guidance wording or adjust its description of the degree of monetary easing.

If the BOJ continues to use the current wording, it will face a new challenge if it raises interest rates to 1.25% in the future – how to justify further rate hikes. Since the lower bound of the BOJ's estimated nominal neutral interest rate range is about 1.1%, and the 1% policy rate is already very close to this level, if rates rise further above 1.1%, it will be difficult to describe monetary policy as accommodative. (Jin Shi)