The Bank of Japan’s unprecedented monetary easing will fail in its goal of spurring 2 percent inflation, according to Takahiro Mitani, president of the fund that manages the world’s largest pool of pension savings.
Japanese shares rose, with the Topix index posting its longest winning streak in three months, as paper makers surged and amid optimism U.S. lawmakers will reach a deal to avoid breaching the debt ceiling.
Japan’s yield curve is likely to steepen as incoming Prime Minister Naoto Kan will seek to rein in borrowings and pressure the central bank to extend monetary easing to lift the economy out of deflation, according to Toyota Asset Management Co.
The panel advising Japan’s leaders on how to keep the Government Pension Investment Fund, the world’s largest manager of retirement savings, from running out of money said depending on domestic bonds has to stop after record fixed-income losses and as inflation returns.
Japanese shares rose, after the Topix index last week posted its fourth straight monthly loss, as a weaker yen boosted carmakers and data signaled a recovery in domestic capital spending and Chinese manufacturing.