Thus, the amount of the government securities that the Bank can purchase has a ceiling that is specified by “confidence”. The Bank has been purchasing a significant amount of JGBs, but its operation rests on a subtle balance that is based on sustaining such confidence.
Above all, it is vital that steps toward fiscal consolidation make steady progress in order not to create any room for misunderstanding the Bank’s action as financing government debt. Role of monetary easing The fourth point is the role of monetary easing and its relationship with other policies and measures.