On Wednesday, the Bank of Japan (BoJ) concluded its 2-day October monetary policy review meeting and left the monetary policy settings unchanged, holding rates at -10bps while maintaining 10yr JGB yield target at 0.00%. The BoJ vote was 8 to 1, leaving its pledge to buy JGBs unchanged so that its holdings increase at an annual pace of around 80 trln yen.
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January BOJ meeting review
In its quarterly economic outlook report, the BoJ made downward revisions to its CPI price forecasts over the coming years, with the details found below. Median core CPI forecast for fiscal 2019/20 at +0.9 pct vs +1.4 pct in October. Median core CPI forecast for fiscal 2020/21 at +1.4 pct vs +1.5 pct in October.
September BOJ meeting review
The Japanese yen was little moved after the Bank of Japan (BOJ) left interest rates unchanged. This was the 32nd month straight of no monetary policy changes. The base lending rate was left at minus 0.1%, which was expected by analysts. In August, the central bank tweaked its ¥80tn-a-year quantitative easing program to strengthen its framework for powerful continuous easing.
The BoJ also maintained its forward guidance and left its asset purchases unchanged. The BoJ has clearly shifted to auto pilot mode after it announced some policy tweaks at the July meeting, and an unchanged signal from the BoJ today was fully expected. Hence, no reaction in USD/JPY or the Japanese fixed income market
Reuters reports additional insights on the Bank of Japan’s (BoJ) monetary policy decision, with the key points found below. Leaves unchanged forward guidance on rates. Will keep current extremely low rates for an extended period of time.
What is the BOJ?
The Bank of Japan (BoJ) is the central bank of Japan. It is a juridical person established based on the Bank of Japan Act (hereafter the Act), and is not a government agency or a private corporation.
POLICY BOARD. The Policy Board is established as the Bank's highest decision-making body. The Board determines the guideline for currency and monetary control, sets the basic principles for carrying out the Bank's operations, and oversees the fulfillment of the duties of the Bank's officers, excluding Auditors and Counsellors.
HISTORY. The Bank of Japan was established under the Bank of Japan Act (promulgated in June 1882) and began operating on October 10, 1882, as the nation's central bank. The Bank was reorganized on May 1, 1942 in conformity with the Bank of Japan Act (hereafter the Act of 1942), promulgated in February 1942. The Act of 1942 strongly reflected the wartime situation: for example, Article 1 stated the objectives of the Bank as "the regulation of the currency, control and facilitation of credit and finance, and the maintenance and fostering of the credit system, pursuant to national policy, in order that the general economic activities of the nation might adequately be enhanced." The Act of 1942 was amended several times after World War II. Such amendments included the establishment of the Policy Board as the Bank's highest decision-making body in June 1949. The Act of 1942 was revised completely in June 1997 under the two principles of "independence" and "transparency." The revised act (the Act) came into effect on April 1, 1998.
Who is BOJ's president?
Haruhiko Kuroda was born in Omuta, in 1944. He is the 31st and current Governor of the Bank of Japan (BOJ). He was formerly the President of the Asian Development Bank from 1 February 2005 to 18 March 2013.
Kuroda has been an advocate of looser monetary policy in Japan. His February 2013 nomination by the incoming government of the Prime Minister Shinzō Abe had been expected. Also nominated at the same time were Kikuo Iwata – "a harsh critic of past BOJ policies" – and Hiroshi Nakaso, a senior BOJ official in charge of international affairs, as Kuroda's two deputies. The former governor, Masaaki Shirakawa, left in March 2013
Kuroda on his Wikipedia's profile
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The World Interest Rates Table reflects the current interest rates of the main countries around the world, set by their respective Central Banks. Rates typically reflect the health of individual economies, as in a perfect scenario, Central Banks tend to rise rates when the economy is growing and therefore instigate inflation.