The governor of the Bank of Japan (BOJ), Kazuo, is directing a press conference on Thursday, explaining the decision of the Central Bank to maintain the interest rate at 0.5% per fourth consecutive meeting.
Additional quotes
The Japan-EE.UU commercial agreement. It is a great advance.
Japan’s economy is recovering moderately, although with some weaknesses.
Easy monetary conditions will support the economy.
Japan’s economic growth will probably be moderated as commercial policies lead to a deceleration in the foreign economy and a decrease in corporate profits.
The underlying inflation will probably stagnate but gradually accelerate.
The developments in commercial policies and how external economy and prices react to them are highly uncertain.
Attention should be paid to the impact of commercial policies on financial, foreign exchange, economy and prices.
We will continue to increase the policy rate if the economy and prices move in line with the forecasts, according to the improvements in the economy and prices.
history in development …
Market reaction
USD/JPY It remains heavy after these comments. The pair was last operating 0.50% down on the day about 148.70.
BANCO DE JAPAN – FREQUENTLY QUESTIONS
The Bank of Japan (BOJ) is the Japanese Central Bank, which sets the country’s monetary policy. Its mandate is to issue tickets and carry out monetary and foreign exchange control to guarantee the stability of prices, which means an inflation objective around 2%.
The Bank of Japan has embarked on an ultralaxa monetary policy since 2013 in order to stimulate the economy and feed inflation in the middle of a low inflation environment. The bank’s policy is based on the Quantitative and Qualitative Easing (QQE), or ticket printing to buy assets such as state or business bonds to provide liquidity. In 2016, the Bank redoubled its strategy and relaxed even more policy by introducing negative interest rates and then directly controlling the performance of its state bonds to 10 years.
The massive stimulus of the Bank of Japan has caused the depreciation of the Yen in front of its main monetary peers. This process has been more recently exacerbated due to a growing divergence of policies between the Bank of Japan and other main central banks, which have chosen to abruptly increase interest rates to combat inflation levels that have been in historical maximums. Japan Bank’s policy to maintain low types has caused an increase in differential with other currencies, dragging the value of YEN.
The weakness of the YEN and the rebound in world energy prices have caused an increase in Japanese inflation, which has exceeded the 2% objective set by the Bank of Japan. Even so, the Bank of Japan judges that the sustainable and stable achievement of the 2%objective is not yet glimpsed, so an abrupt change of current monetary policy seems unlikely.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
