(Corrects currency conversion in second paragraph.)
Jeremy Hall, Singapore-based director of Japanese equities at Henderson Global Investors Ltd., which oversees about $99 billion, comments on the market impact of the Bank of Japan (8301)’s efforts to end deflation.
BOJ Governor Haruhiko Kuroda began his campaign to end 15 years of deflation with a strengthened stimulus program that will see the central bank buy 7 trillion yen ($73 billion) of bonds a month. Policy makers set a 2 percent inflation target within two years.
On BOJ policy:
“It’s a pretty comprehensive spread of proposals. It’s a pretty strong statement of conviction from the Bank of Japan.
‘‘Obviously, the BOJ can’t do it alone. You also need to see a reciprocal action over the longer term on the structural side as well.”
On market valuation:
“I’m still quite constructive on the outlook for Japanese equities. Valuations are still pretty cheap. It is dependent on delivery of improving earnings.”
“The inflation target is aggressive. The fact that they’ve set the target with a time scale is very important.”
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