Wednesday, March 5, 2014

BOJ Is Pumping Like Mad (excerpt)

The Bank of Japan has been injecting lots of liquidity into the financial system over the past year in an effort to stop deflation and raise the CPI inflation rate to 2% on a sustainable basis. January’s monetary base was up 56% y/y. So far, the BOJ can take credit for boosting the inflation rate to 1.4% during January from -0.9% last March. However, it did edge down over the past two months.

The core CPI inflation rate (excluding food & energy) has been positive for the past four months through January, when it was 0.6%. That’s still awfully low, but it beats the 55 consecutive months of negative readings from January 2009 through July 2013.

Today's Morning Briefing: Don't Blink. (1) Shorter panic attacks. (2) Russian markets were blitzed on Monday. (3) Back on melt-up track? (4) Low inflation good for valuations. Deflation bad for earnings. (5) Yellen’s report says temporary factors depressing inflation. (6) There’s deflation in the Eurozone’s PPI. (7) BOJ pumping lots of liquidity to boost inflation a little bit. (More for subscribers.)

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