I am cognizant of the fact that this would have been so much more useful to everyone prior to the BOJ announcement.
But, it was written after the announcement.
Its from Soc Gen - its their "Eight reasons why the BoJ is hesitant about implementing additional QQE". Not all of these make sense to me, but enough do to make this a worthwhile read:
1. There is a risk that the market may once again perceive limits to the effectiveness of monetary policy if additional QQE were to be implemented
2. The Bank of Japan pushed back the timing to achieve the 2% inflation target but did not implement additional QQE
3. The Bank of Japan has various policy measures and increasing the balance for the negative interest rate also has an easing effect
4. There is also a risk that a decision to implement additional easing could influence Prime Minister Abe's political judgement on the next consumption tax hike and the dissolution of the lower house
5.. Arbitrage transactions among financial institutions need to be more active for the BOJ to expand its QQE with the negative interest rate
6. If the BOJ implements additional QQE yen depreciation and a stock market rally could be limited or temporary - this could lead to a larger risk of the BOJ losing confidence
7. What are really necessary are fiscal stimulus and policy measures to stimulate corporate activities and expand net domestic fund demand
8. There is a risk that additional QQE by the BOJ will be perceived as using monetary policy as a currency devaluation tool
