BOJ not doing enough

The BOJ Asset Purchase Program was increased by 10 trillion yen from 70 to 80 trillion yen. The impact of driving the exchange rate lower was short-lived. The BOJ action is again too little relative to the Fed and ECB. The relative value still places the yen in a strong position. The Japanese monetary base has increased by only 36 percent since pre-Lehman levels while the Fed has increased its monetary base by 300 percent. The ECB has seen an increase in their monetary base of 200 percent.

The  yield curve is still lower than the US, but the inflation rate is still negative and growth is slow. The low rates does not tell us that monetary policy is easy. The exchange rate will tell us that policy is easy.