16 Feb 2015
BoJ to stay on hold? - BAML
FXStreet (Guatemala) - Analysts at Bank of america Merrill Lynch explained that the BoJ is likely to keep its policy on hold and the focus will be Governor Kuroda's press conference.
Key Quotes:
"The market will watch his view on (1) the inflation outlook, (2) JGB market volatility, and (3) currency rate."
"We do not expect the meeting to disturb the prevailing upward bias in USD/JPY and long-term trend of lower JGB yields."
"At its 17-18 February policy meeting, the BoJ is likely to maintain its policy framework in terms of the scale of asset purchases and the maturities of the bonds it purchases."
"The YoY rise in the core CPI slipped to 0.5% in December (excluding the effects of the consumption tax hike), mainly because of the decline in oil prices. As a result, there is growing pessimism on the likelihood inflation will reach the BoJ's 2% target. However, its revised growth and price forecasts (released after the last meeting, held 20-21 January) show a very weak inflation forecast for FY3/16, owing to the fall in oil prices, but a rebound to over 2% in FY3/16 on a decline in the output gap thanks to the economic recovery."
Key Quotes:
"The market will watch his view on (1) the inflation outlook, (2) JGB market volatility, and (3) currency rate."
"We do not expect the meeting to disturb the prevailing upward bias in USD/JPY and long-term trend of lower JGB yields."
"At its 17-18 February policy meeting, the BoJ is likely to maintain its policy framework in terms of the scale of asset purchases and the maturities of the bonds it purchases."
"The YoY rise in the core CPI slipped to 0.5% in December (excluding the effects of the consumption tax hike), mainly because of the decline in oil prices. As a result, there is growing pessimism on the likelihood inflation will reach the BoJ's 2% target. However, its revised growth and price forecasts (released after the last meeting, held 20-21 January) show a very weak inflation forecast for FY3/16, owing to the fall in oil prices, but a rebound to over 2% in FY3/16 on a decline in the output gap thanks to the economic recovery."