Bank of Japan announces massive asset-purchase programme

£90bn of government assets purchased each month starting in January 2014.

The Bank of Japan has made its much-foreshadowed move to attempt to end the years of deflation the country has faced. This morning, it announced that it was repositioning its inflation target from 1 per cent to 2 per cent, and that it would aim to achieve that rate "at the earliest possible time".

The plan involves more than just expectations management, as well. Until the end of this year, the bank will continue with its ¥101trn round of quantitative easing, but from January 2014 it will begin buying ¥13trn — over £90bn — of assets, mostly short-term government debt, each month. The hope is that the massive burst of asset purchases will act to spike inflation, but there are indications that the government also plans to use some of the revenue this monetary policy will accord to it for fiscal stimulus.

As well as being higher than it was before, the inflation target is also stronger, replacing a "vaguely-worded “goal” for price stability over the medium to long-term", according to the Financial Times. That goal was not thought to be symmetrical, either: it merely targeted a positive rate of inflation below 2 per cent. Non-symmetric targets tend to inspire a tendency to undershoot (because if 1.9 per cent is OK but 2.1 per cent is terrible, no bank will aim for 2 per cent inflation), compounding the problems.

The news is not likely to please Germany's chief banker, Jens Weidmann, who yesterday warned of the danger of a government intervening too strongly in the actions of a central bank. Weidmann said in a speech at a Deutsche Boerse event that:

Already alarming violations can be observed, for example in Hungary or Japan, where the new government is interfering massively in the business of the central bank with pressure for a more aggressive monetary policy and threatening an end to central bank autonomy. A consequence, whether intentional or unintentional, could moreover be an increased politicisation of exchange rates.

But Weidmann is complaining into dead air, at this point. Japan's popular nationalist new prime minister, Shinzo Abe, is determined to restore the country to growth by any means possible. A recent tax bill, passed before his election, contains a (non-binding) target of 3 per cent nominal growth and 2 per cent real growth (implying a 1 per cent rate of inflation), which he is likely to adopt as a target for his own government. To achieve that, he needs some aid from the Bank of Japan — aid which he has secured. The question now is whether the bank will be allowed to return to independence when its job is done.

The Bank of Japan. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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The Brexit select committee walkout is an ominous sign of things to come

Leavers walked out of a meeting of Hilary Benn's "gloomy" committee yesterday. Their inability to accept criticism could have disastrous consequences

“Hilary Benn isn’t managing a select committee. He’s managing an ecosystem.” That was the stark verdict of one member of the Commons' Brexit committee on its fitness for purpose yesterday. If its meeting on the eve of Article 50 is anything to go by, then Benn’s fragile biome might already be damaged beyond repair.

Unhappy with the content of its “gloomy” provisional 155-page report into the government’s Brexit white paper, leavers on the committee walked out of its meeting yesterday. The committee is a necessarily unwieldy creation and it would probably be unreasonable to expect it to agree unanimously on anything: it has 21 members where others have 11, so as to adequately represent Leavers, Remainers and the nations.

Disagreements are one thing. Debate and scrutiny, after all, are why select committees exist. But the Brexiteers’ ceremonial exodus augurs terribly for the already grim-looking trajectory of the negotiations to come. “As I understand it, they don’t like analysing the evidence that they have,” another pro-Remain member of the committee told me.

Therein lies the fundamental weakness of the Brexiteers’ position: they cannot change the evidence. As was the case with the 70 MPs who wrote to Lord Hall last week to accuse the BBC of anti-Brexit bias, they assume a pernicious selectivity on the part of Remainers and their approach to the inconvenient facts at hand. None exists.

On the contrary, there is a sense of resignation among some Remainers on the Brexit committee that their reports will turn out to be pretty weak beer as a consequence of the accommodations made by Benn to their Eurosceptic colleagues. Some grumble that high-profile Brexiteers lack detailed understanding of the grittier issues at play – such as the Good Friday Agreement – and only value the committee insofar as it gives them the opportunity to grandstand to big audiences.

The Tory awkward squad’s inability to accept anything less than the studied neutrality that plagued the Brexit discourse in the run-up to the referendum – or, indeed, any critical analysis whatsoever – could yet make an already inauspicious scenario unsalvageable. If they cannot accept even a watered-down assessment of the risks ahead, then what happens when those risks are made real? Will they ever accept the possibility that it could be reality, and not the Remain heretics, doing Britain down? How bad will things have to get before saving face isn’t their primary imperative?

Yesterday's pantomime exit might have been, as one committee member told me, “hysterically funny”. What’s less amusing is that these are the only people the prime minister deigns to listen to.

Patrick Maguire writes about politics and is the 2016 winner of the Anthony Howard Award.