Bank of Japan derivatives purchases threaten already low equity ratio
The proposal to expand the Bank of Japan's asset purchase programme to include derivatives may prove challenging for the bank's balance sheet as it faces a historically low equity ratio.
The Bank of Japan's nominee governor, Haruhiko Kuroda, said the bank may buy derivatives to pursue its inflation target of 2% in the next two years. The unconventional policy stance comes as a re-enforcement of the new leadership of the central bank under the Liberal Democratic Party (LDP) government whose
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