It will conduct such purchases more flexibly in a prioritized manner while taking into account market conditions. The decision reflects the fact that ETF and J-REIT purchases have been containing instability in the market by lowering risk premia, and that the effects of purchases tend to be greater the higher the instability in financial markets and the larger the size of purchases (Chart 12).
The second scenario is the one depicted recently by Charles Goodhart, in which the downward trend of inflation is reversed on the back of a reversal of demographic and globalization trends, rising labor bargaining power, and rising interest rates. He argues that the Covid-19 pandemic may accelerate this reversal.