Ok, so the BoJ has spoken. Finally.
Because anyone who has ever waited around for these announcements can certainly sympathize with this:
— David Scutt (@Scutty) July 20, 2017
Anyway, as expected, policy is on hold and the 10Y JGB yield target remains at ~0%.
The economic outlook was upgraded and the goal post was moved for reaching the ever-elusive inflation target.
- BOJ MAINTAINS 10-YEAR JGB YIELD TARGET AT ABOUT 0.000%
- BOJ MAINTAINS POLICY BALANCE RATE AT -0.100%
- BOJ FY2018 CORE CPI FORECAST IS 1.5%
- BOJ RAISES ASSESSMENT OF ECONOMY
- BANK OF JAPAN FY2017 CORE CPI FORECAST IS 1.1%
- BANK OF JAPAN FY2019 CORE CPI FORECAST IS 1.8%
- BANK OF JAPAN FY2017 GDP FORECAST IS 1.8%
- BANK OF JAPAN FY2018 GDP FORECAST IS 1.4%
- BANK OF JAPAN FY2019 GDP FORECAST IS 0.7%
- BOJ DELAYS TIMING OF REACHING 2% GOAL TO AROUND FY2019
As a reminder:
So far, the yen is shrugging its shoulders, although that is of course subject to change as the overnight session drags on.
Generally speaking, this looks like a snoozer. We already knew the bank was going to stand by its commitments as evidenced by the recent redoubling of efforts to cap yields in the face of upward pressure on DM rates and inflation is nowhere near the bank’s target.
So much for speculation that Kuroda would unveil something “new” or otherwise deliver a little more of his patented “Peter Pan” magic.
I suppose Abe will have to lean on something else to rescue his reputation because it looks like Kuroda is just about out of pixie dust.
Of course that’s just the kind of thinking that Kuroda has repeatedly warned against. After all, “the moment you doubt whether you can fly, you cease forever to be able to do it.”
“Yes, what we need is a positive attitude and conviction.”