Bank of Japan Gov. Haruhiko Kuroda has shown that a single unprecedented expansion of monetary policy has more impact than a series of smaller steps, and economists say he's preparing to prove it again.
The yen has tumbled almost 9 percent since Kuroda doubled monthly bond purchases at his first meeting as head of the BOJ in April last year. In contrast, the yen gained about 3 percent in the two years that started October 2010, when then-Gov. Masaaki Shirakawa introduced a smaller asset-purchase program that was expanded at least seven times before the central bank was pressured to conduct unlimited easing.
While Kuroda refrained from taking any extra step when policymakers concluded a two-day meeting Tuesday, economists predict that the central bank will double purchases of exchange-traded funds in coming months. The yen may decline further as the BOJ's easing and the outlook for a rate increase by the Federal Reserve widen the gap between yields in the U.S. and Japan, according to analyst estimates.