BIS Working Papers-To lend or not to lend: the Bank of Japan's ETF purchase program and securities lending

October 16, 2023--August 2, 2023-Summary
Focus-We study the effects of the Bank of Japan's (BOJ) ETF purchasing programme on stock returns, focusing particularly on the role of the stock lending market. In 2010, the BOJ established a programme to conduct outright purchases of various financial assets to stimulate the economy. This policy is unique as a monetary policy because equity index-tracking exchange-traded funds (ETFs) were included in those assets.

The BOJ has continuously increased its purchasing amounts and its market presence has provoked discussions on how it has affected the market's structure.

Contribution
While some previous studies show that the programme significantly affected Japanese stock prices, these arguments relied solely on demand and supply in the spot market, almost completely ignoring the role of the stock lending market. To fill this gap, this study investigates the effects of the ETF purchasing programme by focusing on both spot and stock lending markets.

China economic database update

November 17, 2025-The monthly update of the China Economic Database highlights a consistent trend of decreasing fixed asset investment in China, including in the real estate sector which shows no signs of bottoming out. This update incorporates data published today by China's National Bureau of Statistic.