27 Feb 2015
Kuroda’s comments implies Japan might see a lot more easing ahead – BTMU
FXStreet (Barcelona) - Derek Halpenny, European Head of GMR at Bank of Tokyo-Mitsubishi UFJ, views that Kuroda’s comments on attaining the inflation target post Japan painting a soft CPI today, implies that a lot more easing lies ahead for Japan.
Key Quotes
“The nationwide core annual CPI rate in Japan slowed from 2.5% to 2.2% in January, in data released this morning, a touch weaker than the market consensus. If you exclude the sales tax impact, the core nationwide annual CPI rate increased just 0.2%.”
“The BOJ in its updated forecasts last month lowered the forecast for nationwide core CPI from 1.7% to 1.0% for FY2015 and even that is now looking an unlikely level to reach.”
“If you assume oil remains around where it is now through to May when the sales tax increase falls out of the annual CPI calculations, there is a decent chance that the annual rate will turn negative again.”
“Governor Kuroda was on the wires today and once again expressed confidence in achieving the BOJ goal of reaching the 2.0% target rate.”
“Still from when QQE was first launched in April 2013, a 2.0% inflation level in "about two years" has been missed and given that Kuroda today stated that inflation at 2% would have to be well anchored before its objective is achieved, another two years from now seems the earliest that the BOJ might be able to declare that price stability has been achieved.”
“That implies a lot more monetary easing lies ahead which will ensure the yen remains on a weakening path.”
Key Quotes
“The nationwide core annual CPI rate in Japan slowed from 2.5% to 2.2% in January, in data released this morning, a touch weaker than the market consensus. If you exclude the sales tax impact, the core nationwide annual CPI rate increased just 0.2%.”
“The BOJ in its updated forecasts last month lowered the forecast for nationwide core CPI from 1.7% to 1.0% for FY2015 and even that is now looking an unlikely level to reach.”
“If you assume oil remains around where it is now through to May when the sales tax increase falls out of the annual CPI calculations, there is a decent chance that the annual rate will turn negative again.”
“Governor Kuroda was on the wires today and once again expressed confidence in achieving the BOJ goal of reaching the 2.0% target rate.”
“Still from when QQE was first launched in April 2013, a 2.0% inflation level in "about two years" has been missed and given that Kuroda today stated that inflation at 2% would have to be well anchored before its objective is achieved, another two years from now seems the earliest that the BOJ might be able to declare that price stability has been achieved.”
“That implies a lot more monetary easing lies ahead which will ensure the yen remains on a weakening path.”