BoJ Minutes: Several members said must be vigilant to risk inflation may accelerate more than expected

Anil Panchal FXStreet

“Several members said must be vigilant to risk inflation may accelerate more than expected,” as per the March month’s Monetary Policy Meeting Minutes from the Bank of Japan (BoJ).

Key statements

Members agreed there was very high uncertainty surrounding Japan's economy.

Several members said cost-push price pressure might last longer than expected if global commodity prices rise more than projected.

A few members said there were some positive signs towards achieving BoJ price target.

A few members said must scrutinize balance of effect, cost of stimulus, but must maintain massive stimulus for now.

One member said BoJ must focus on risk of missing achievement of price target with premature policy shift, rather than risk of being too late in changing policy.

One member said shift in monetary policy would affect markets, wide range of entities so must be debated cautiously.

One member said BoJ must take steps to improve market function, including that for corporate bonds and swap markets, as needed.

One member flagged idea that as long as wage and price growth are positive and stable, they could be allowed to rise to high levels.

A few members said that idea wasn't valid as history suggests that when inflation is too high, its moves tend to become volatile.

A few members said it was appropriate to debate tweaking BoJ’s policy guidance tied to covid-19 pandemic.

USD/JPY stays firmer past 135.00

Following the BoJ Minutes, USD/JPY remains on the front foot while extending Friday’s recovery to 135.25 by the press time.

About the Bank of Japan Monetary Policy Meeting Minutes

The Bank of Japan publishes a study of economic movements in Japan after the actual meeting. These meetings are held to review economic developments inside and outside of Japan and indicate a sign of new fiscal policy. Any changes in this report tend to affect the JPY volatility. Generally speaking, if the BoJ minutes show a hawkish outlook, that is seen as positive (or bullish) for the JPY, while a dovish outlook is seen as negative (or bearish).

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

GBP/USD loses momentum, flirts with 1.3200

GBP/USD is struggling to maintain its positive bias on Thursday, retreating toward the 1.3200 region in response to the pick in the buying interest around the Greenback. That said, Cable remains under scrutiny as cautious market sentiment keeps investors focused on the US-Iran conflict and political effervescence in the UK.

EUR/USD trims gains, challenges 1.1400

EUR/USD now gives away part of its earlier advance, receding toward the 1.1400 contention zone on Thursday. Meanwhile, the pair’s recovery comes amid extra losses in the US Dollar, at the time when while investors continue to monitor developments in the Middle East and sentiment surrounding global technology stocks.

Gold remains bid and close to $4,100

Gold accelerates its recovery and approaches the key $4,000 mark per troy ounce at the end of the week, adding to Thursday’s advance. However, expectations for a hawkish Fed remain steady and keep the yellow metal’s potential upside contained.

Crypto Today: Bitcoin at $60,000, Ethereum at $1,500, and XRP at $1 face a make-or-break test

Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) are trading in the red on Friday after three consecutive days of losses, testing their respective make-or-break support levels.

Week ahead – NFP report to challenge Dollar strength and the hawkish Fed

Dollar strength dominates markets, as the hawkish Fed overshadows geopolitics and lower oil prices. NFP week could drive September Fed hike expectations and boost market volatility. The euro lacks fresh bullish catalysts, all eyes on the preliminary inflation report and the ECB Forum.

Regime change: Inside Kevin Warsh's first move to make the Fed unreadable on purpose

The rate did not move. That was the least interesting thing about Kevin Warsh's first meeting in charge of the Fed. The FOMC held its benchmark at 3.50%-3.75% for the fourth straight meeting, exactly as priced, and then the new chair used his first press conference to dismantle the machinery the market has leaned on for a decade.