Bank of Japan loosens its belt another notch

Japan’s central bank ploughed on with its monetary easing yesterday, increasing the size of its asset purchase programme and setting up an unlimited loan facility to stimulate bank lending.

The announcement carried no real surprises. The Bank of Japan is upping its purchases by 11 trillion to 91 trillion, mainly in the form of government securities, but also a small amount of riskier asset such as J-Reits and ETFs, while the lending measures will provide banks with access to long-term loans at 0.1% in a bid to boost bank loans to corporates.

A few optimists had held out hope that the central bank would take a...