Market expectations are high when the BOJ meets this week. Some expect a significant increase in QQE spending, to the tune of 15 to 20 Trillion yen (around $190 billion USD or 4% of GDP). There have also been rumors, spurred on by a recent visit by Bernanke, that more radical measures may be on the table including the use of outright “Helicopter Money”, a policy tool not used in Japan since the 1930s. The BOJ has since ruled out the policy, but will more QQE turn the tide or are fiscal measures needed?
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