Nikkei closes down as BoJ agrees to open-ended easing

<p>The Nikkei 225 has retreated following the BoJ’s decision to implement monetary easing and raise its inflation target.</p>

The Nikkei 225 closed lower when the Tokyo stock exchange finished for the day (January 22nd) after the Bank of Japan (BoJ) announced it would be implementing an open-ended monetary easing programme.

Economists had speculated the central bank would remain guarded, without yielding to the demands of prime minister Shinzo Abe, when in fact the two-day meting of the institution's policymakers revealed the BoJ is far more in line with the government's demands than first thought.

In addition to offering to initiate asset purchases from 2014 for as long as necessary, the BoJ will also be doubling its inflation target to two per cent.

Both these changes have been lobbied by Mr Abe since his election campaign last year, while the government and BoJ released a rare joint statement confirming their plans for the world's third-largest economy.

When the Nikkei 225 closed this morning, it fell by 0.3 per cent to an index value of 10709.9 points.

Learn about the Asian markets and find spread betting tips at City Index.

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.