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[Tokio19Reuters]- The market is expected to test the “standards” and “limits” of changes that the Bank of Japan has shown in its policy inspections. It is expected to determine what type of stock price will move to buy exchange-traded funds (ETFs) and at what stage, if long-term interest rates rise, it will act sparingly.
The ETF purchase was held within a 12 trillion yen year of the upper limit, but the 6 trillion yen year outlook has been removed. With the absolute “commitment” of scale of purchase gone, what the market is expected to try are the “criteria” of purchase. We will explore what type of stock price situation will move to buy the BOJ.
In January of this year, there was a movement that attracted attention. At the time, what the market saw as the “standard” was the rate of decline in the TOPIX market. There was widespread recognition that the BOJ would take action to buy ETFs if the rate of decline was greater than 0.5%.
In fact, on the 15th, when TOPIX’s decline rate was 0.51%, regular ETFs were bought for 50.1 billion yen, on the 18th, when it was 0.49%, no purchases were made. , and on the 20th, when it was 0.51%. , 501. There was a clear distinction between buying 100 million yen and buying at 0.5%.
Subsequently, even if it falls below 0.5%, the “standard” is broken, as the number of cases in which no purchases are made increases. “The purchase criteria can be based on various risk premiums, such as yield margin (difference in yield between government bonds and stocks), PER (price-earnings ratio), PBR (price-book value ratio) and volatility “(Nissei). Mr. Shingo Ide, chief equity strategist at the Basic Research Institute) has also been pointed out.
However, the market tends to look for simple “standards” like January of this year. First of all, after this “inspection”, it seems that we will pay close attention to the slight difference in size that the TOPIX front-end decline rate must be in order to buy ETFs.
<¿Es la prueba del límite superior de la tasa de interés a largo plazo una espera?>
On the other hand, there are many opinions that the measure to test the “upper limit” of the range of allowable fluctuation of long-term interest rates will be suspended for a time. This is because the existence of the recently introduced “continuous limit price trade” is disturbing.
The “continuous limit operation” is a method of curbing a significant increase in interest rates, and in order to further strengthen the limit operation for the purchase of unlimited government bonds with a specific maturity, the operation is said to limit will be made continuously for a certain period. time frame.
Takenobu Nakajima, chief interest rate strategist at Nomura Securities, said: “The details are unknown, but it also threatens to curb interest rate increases. Regarding ultra-long-term interest rates, it is the same as the conventional expression that an excessive decrease is undesirable, so long-term Since interest rates are less likely to rise, ultra-long-term interest rates are less likely to rise. “
This time, the expanded jitter tolerance is plus or minus 0.25%. The highest level of long-term interest rates after the Bank of Japan expanded its fluctuation allowance to about 0.2% in July 2018 was 0.175% on February 26, 2018, which has reached the upper limit so far. .
However, since US long-term interest rates (10-year government bonds) rise rapidly to the 1.7% level for the first time in a year and two months, there is a chance that increase upward pressure linked to interest rates on Japanese government bonds. . At that point, the BOJ is likely to draw the market’s attention to whether it will move to moderation before 0.25% or if it will move beyond.
<¿Hay algún cambio en la "presencia" del BOJ?>
Another important point in this inspection is if there is a change in the “presence” of the BOJ market.
The ETF owned by the Bank of Japan was 35.6 trillion yen at the end of January 2009 (book value). It has increased 23 times from 1.5 trillion yen at the end of 2012. Since it extended the annual target to 6 trillion yen in July 2016, it has bought 5.9 trillion yen in 2017, 6.5 trillion yen. in 2018, 4.3 trillion yen in 2019 and 7.1 trillion yen in 20. It is the main buyer of Japanese stocks. outperforming foreign investors.
At the end of December 2008, JGB holdings amounted to 545 trillion yen, representing 44.7% of the total balance of JGB, etc. of 1220 trillion yen. At the end of December 2012, before taking office as President Haruhiko Kuroda, it was only 9.9%, but now the BOJ has a large amount of government bonds and the “effect of stocks” makes it difficult for the rates of interest go up.
There are many voices in the market who are concerned that the BOJ’s asset purchase will have an undue impact on the financial markets. On the other hand, it is analyzed that low interest rates and high stock prices have been achieved.
The Bank of Japan states that the purpose of policy inspections is to increase the sustainability of policies. However, in the market, “Overall, the purchase amount of long-term government bonds and ETFs is expected to decline. The real goal is to reduce spillover effects through a decrease in asset purchases.” (Think tank economist). .
“The BOJ’s policies have become so complex that the number of inquiries from foreign investors has decreased,” said Kiichi Murashima, chief economist at Citigroup Global Markets. There is great uncertainty about how the market will move if the BOJ’s “asylum”, which has become extremely strong in the market, weakens.
(Edited by Daiki Iga, Hiroshi Hashimoto)
