The Bank of Japan may expand stimulus measures this month after lawmakers escalated pressure by blocking a nominee for its Policy Board and renewed calls for a more proactive monetary policy.
Morgan Stanley MUFG Securities Co., Mizuho Securities Co. and SMBC Nikko Securities Inc. all predict that the BOJ will expand asset purchases at an April 27 meeting.
The Upper House rejected the nomination of Ryutaro Kono, 47, for the Policy Board on Thursday. Kono, an economist at BNP Paribas SA, is described by Goldman Sachs Group Inc. as holding similar views to BOJ Gov. Masaaki Shirakawa — who says that monetary policy alone cannot solve deflation. The central bank may stand pat at a two-day meeting ending Tuesday and save its ammunition for later this month, when price projections are expected to show that a goal of 1 percent inflation is not in sight, according to Morgan Stanley.