How Have Japanese Inflationary Expectations Evolved since January 2020: Evidence from the stock market

Rising oil and food prices, a weakening yen and other factors can raise the inflation rate. The Bank of Japan (BoJ) has been attempting to increase inflation at least since Haruhiko Kuroda became head of the BoJ in March 2013. In April 2013 the BoJ implemented quantitative and qualitative monetary easing, significantly increasing the monetary base. In January 2016 it instituted negative interest rates and in September 2016 it introduced yield curve control by targeting short and long-term interest rates. The BoJ abandoned negative rates on the uncollateralized overnight call rate in March 2024. It raised its target for overnight interest rates to 0.25 per cent in July 2024 and to 0.5 per cent in January 2025.

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