BoJ Minutes: No possibility that the momentum toward achieving the price stability target would be lost

The Bank of Japan's October meeting minutes started with, "most members shared view that there had been no further increase in the possibility that the momentum toward achieving the price stability target would be lost," - Reuters news.

Key notes

• One member said given downside risks, BoJ should continue to examine whether additional monetary easing would be necessary.
• Some members said BoJ must not hesitate to take additional easing measures if there was a greater possibility momentum toward achieving the price target would be lost.
• BoJ minutes: a few members said BoJshould prepare for next economic downturn as among risk scenarios, what's important is to enhance cooperation with government on economic policies.
• Some members said BoJ must link its forward guidance to price momentum, make clear there would be downward bias in policy rates.
• A few members said while financial institutions' financial soundness was ensured for the moment, cumulative side effects of prolonged low interest rates warranted vigilance.
• One member said life insurers may face difficulties in maintaining provision of insurance products if long-term yields remained at around current levels for a long period.

FX implications

There is nothing here that was not already well documented and announced since the meeting that took place back in October. The Summary of Opinions that came out in November did a good job of putting out the details of the meeting.  The main takeaway was:

• BOJ should communicate clearly it will continue with powerful monetary easing given that achieving price stability target will take time.

USD/JPY is currently located at 109.37 in a tight 109.36/41 range.