Goldman Sachs predicts that the Bank of Japan will gradually sell off 37 trillion yen in ETF assets.

Goldman Sachs stated that when the Bank of Japan decides to reduce its holdings of ETFs in the future, it will choose to gradually sell these ETFs in the market, rather than transferring them to the government as some have suggested. Since 2010, as part of its ultra-loose monetary policy to revive the sluggish economy, the Bank of Japan has been purchasing ETFs, a move that has continued for 13 years. Although the Bank of Japan stopped purchasing ETFs last year, it has not announced when and how it will dispose of its holdings of approximately 37 trillion yen (about 252 billion dollars) in ETF assets, which have a market capitalization of about 70 trillion yen. The Bank of Japan has stated that when it decides to reduce these assets, it will be based on three principles: selling at an appropriate price, avoiding losses for the central bank, and selling in a manner that minimizes market disruption. Goldman Sachs pointed out that a way to meet these three conditions could be to gradually sell small amounts in the open market.