TREE NEWS update: Japan’s Minister for Economic and Fiscal Policy, Minoru Kiuchi, said Monday the government respects the Bank of Japan’s policy of selling its exchange-traded fund holdings. Speaking at a regular press conference in Tokyo, Kiuchi also said caution is still needed before declaring an end to deflation, and that this view remains unchanged.
Japan Minister Calls for Caution on Declaring End of Deflation
Kiuchi's twin comments matter because they signal fiscal-side tolerance for the BOJ's ETF unwind while withholding endorsement of a formal deflation exit — a pairing that keeps the policy backdrop ambiguous rather than resolving it. The deflation call carries weight beyond Japan: it has underpinned the yen carry trade and global risk appetite, so the hesitation itself is the signal. Whether the government's stance shifts as ETF sales proceed, and whether the deflation declaration stays on hold, are the open questions worth watching.
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