Apparently motivated by the European Central Bank's decision to buy unlimited amounts of government bonds and the U.S. Federal Reserve's third round of quantitative easing, the Bank of Japan announced new steps for monetary easing on Wednesday.
Its main pillar is increasing the BOJ's asset purchasing fund by ¥10 trillion to ¥80 trillion to buy more long- and short-term government bonds. It will continue to buy such bonds through the end of 2013, a half year longer than originally planned.
The central bank should be praised for shedding its cautious attitude toward taking measures to pull the Japanese economy out of its long period of deflation and to put it on a path of steady recovery. Of great importance though, it must remain flexible over its monetary policy in case signs crop up that economic conditions are deteriorating.