Bank of Japan Governor Haruhiko Kuroda said monetary easing by a central bank does not necessarily lead to cross-border capital outflows from that country, saying:
- “Almost all base money provided through monetary policy will be accumulated in the form of deposits with a central bank”
- “Even if a country eases monetary conditions, this does not necessarily mean that money being provided directly ‘spills over overseas'”
There is (a little) more here at Reuters.
Kuroda’s comments are interesting in light of the falling markets and currencies in emerging markets, which has blamed on imminent winding-back of Federal reserve asset purchases