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BoJ January policy meeting Summary of Opinions: Price rises accelerating

The Bank of Japan's Summary of Opinions is coming out in stages.

Key points

It will take time for Japan to achieve sustained wage growth, must support the economy with macro policy.
    
Focusing on service prices as demand-pull inflation must be achieved for Bank of Jaopan's price target to be met.
    
Price rises accelerating not just for goods but for services.
    
Public's norm on prices may be changing due to big, external shock.

Appropriate to maintain current monetary easing, including YCC.
    
Crucial to generate positive economic, price cycle in order to achieve BoJ's price target
    
BoJ must keep yields from rising across curve while being mindful of bond market function.
    
Must spend more time to gauge impact of December decision on bond market function.
    
Must communicate to markets achievement of price target will take some time.
    
Expansion of BoJ's market operation tool will help create stable shape of yield curve.
    
When time for exiting ultra-loose policy comes, boj must check whether market players are prepared for the move.
    
BoJ must conduct a review of its policy at some point, but appropriate to maintain easy monetary policy for now.
    
Japan's consumer inflation is likely to slow pace of increase toward latter half of next fiscal year.
    
Cost-push pressure on prices are starting to ease.
    
Still see some distance in achieving the BoJs price target.

USD/JPY update

There has been no effect on the Yen but the price action was volatile on Wednesday with the bulls now back under pressure again towards 129.00:

If the bulls commit near 129.00, the has a confluence with the 129.00 figure, then there could be prosp3ects of a move back to test 130.00 before the week is out. 

About the Bank of Japan's Summary of Opinions

This report includes the BOJ's projection for inflation and economic growth. It is scheduled 8 times per year, about 10 days after the Monetary Policy Statement is released.

Author

Ross J Burland

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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