The Efficiency Analysis Of Japan’s New Round Of Quantitative Easing Monetary Policy

In response to the severe economic recession, the Japanese government carried out the zero interest rate policy and quantitative easing monetary policy to stimulate consumption, investment, overcome deflation state of the economy in the early 20th century and the 21st century.The global economic crisis for Japan is a disaster, the financial sector crisis quickly spread to the real economy. Sharp drop in corporate earnings, a sharp decline in external demand, reduced disposable income, the price index remains in the doldrums, economic deflation even worse than the birthplace of the United States.In order to promote corporate finance, maintain market stability,the Bank of Japan began a new round of quantitative easing monetary policy after the 2008 financial crisis.More quantitative easing monetary policy refers to when the economy into a liquidity trap, the central bank injected a large amount of liquidity to the market, increasing the base money supply by buying government bonds and other long-term bonds and other means.Quantitative easing monetary policy can achieve overcoming deflation and stabilize the price level, maintaining financial system stability, stimulating investment and other macroeconomic goals through the timeline effect, the balance sheet expansion effects and portfolio effect.After the financial crisis, the Japanese restart the quantitative easing monetary policy. The ultra-large-scale quantitative easing policy is the first sword to stimulate the economy through abenomics.According to the existing theory, the article summarizes the monetary policy and the economic situation in Japan since the bubble burst in the 1990s. Meanwhile, the paper analyzes Japan’s new round of quantitative easing monetary policy features and effectiveness.The study found that Japan’s new round of quantitative easing monetary policy only play a limited role in enhancing consumer confidence and reducing long-term interest rates. It did not work in recovery credit system function,overcoming deflation and restoring economic growth.