Speaking at a news conference after the Federal Open Market Committee meeting, US Federal Reserve Chairwoman Janet Yellen stated that ‘helicopter money’ could be considered under certain conditions. In Japan, with currency intervention effectively off the table for fear of accusations of being a currency manipulator, there is increasing speculation that the BoJ may pursue further monetary policy experimentation. ‘Helicopter money’ could offer the BoJ a means of increasing the supply of yen vs. other currencies. Nikko AM’s Multi Asset team has previously written about our concern that monetary policy is reaching the limits of its effectiveness, particularly when considering zero and negative interest rate policies and quantitative easing . However, we believe that ‘helicopter money’ could actually prove effective. But it comes with significant risks. (VIEW LINK)