BOJ will remain on hold until 2021 – Societe Generale
|The Research Team at Societe Generale is out with its outlook on the Bank of Japan (BOJ) monetary policy after the Japanese central bank left the policy steady on Thursday.
Key Quotes:
“Remained on hold at the June monetary policy meeting
The focus among market participants ahead of the meeting had been on whether the BoJ would give any signals that it will follow the recent dovish trend of global central banks.
However, … Strong domestic fundamentals continue to offset the negative shocks from uncertainties overseas. Economic data continues to show strength in the domestic economy. Under such circumstances, the BoJ likely maintained the view that it could continue to wait for further data and developments.
Our central scenario continues to be that the BoJ will remain on hold until 2021, after the Tokyo Olympic games.
If risks to achieving the 2% inflation target strengthen, then BoJ policy board members could give more indications that it would be ready to act if needed, following the recent trend of global central bankers.”
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