As I’ve outlined in recent missives, Japan is at the forefront for Keynesian driven Central Bank monetary policy. Japan was not only the first Central Bank to start ZIRP and QE, it has also launched the single largest QE program in history (a single QE program equal to over 25% of Japan’s GDP).
However, in the last few months, the Head of the Bank of Japan, Haruhiko Kuroda has lost credibility for the markets. Specifically:
1) The markets only rallied for a day after he announced NIRP.