BoJ’s Noguchi: Various indicators of inflation expectations are gradually approaching 2%.
Bank of Japan (BoJ) board member Asahi Noguchi said in a scheduled appearance on Monday that “various indicators of inflation expectations are gradually approaching 2%.”
Additional quotes
Central bank with excessively large balance sheet should reduce outstanding assets with due consideration to market stability, allow markets to set asset prices as much as possible.
If central bank engages in excessive QT and reduces supply of reserves too much relative to demand, it may not be able to adequately control money market rate.
Corporate profits have been growing on the whole, it is becoming easier for firms to pass on costs to prices.
Various indicators of inflation expectations are gradually approaching 2%.
It seems clear that people are acting on the assumption that the economy will not return to zero inflation.
Japan's economy is in the midst of shifting away from the zero norm and adapting to the new 2% norm.
Rise in import prices has already slowed, so consumer inflation will probably slow ahead.
It may take some time for real wages to turn to uptrend.
Data shows Japan is moving steadily toward achieving 2% inflation target.
This means need for adjustment to policy rate is heightening more than ever before.
Japan's economy, prices face downside risks, but upside risks have become more important in making policy decision.
Japan's monetary policy is entering phase in which careful assessment of situation is needed.
Japan's economy is currently experiencing high inflation for the first time in decades.
Japan's current high inflation is probably due to a major shift in firms' price- and wage-setting behavior.
Rigidity of services prices is gradually weakening, a trend that is likely to continue.
Going forward, key would be whether this trend in service prices would steadily expand to small, medium-sized firms and regional economies.
Market reaction
At the press time, USD/JPY remains heavy near 148.85 following these comments, losing 0.45% on the day amid broad US Dollar (USD) weakness.
Japanese Yen Price Today
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.20% | -0.33% | -0.40% | -0.10% | -0.31% | -0.04% | -0.18% | |
| EUR | 0.20% | -0.12% | -0.38% | 0.09% | -0.11% | 0.17% | 0.00% | |
| GBP | 0.33% | 0.12% | -0.16% | 0.23% | -0.03% | 0.29% | 0.14% | |
| JPY | 0.40% | 0.38% | 0.16% | 0.36% | 0.15% | 0.26% | 0.29% | |
| CAD | 0.10% | -0.09% | -0.23% | -0.36% | -0.17% | 0.06% | -0.09% | |
| AUD | 0.31% | 0.11% | 0.03% | -0.15% | 0.17% | 0.26% | 0.11% | |
| NZD | 0.04% | -0.17% | -0.29% | -0.26% | -0.06% | -0.26% | 0.00% | |
| CHF | 0.18% | -0.01% | -0.14% | -0.29% | 0.09% | -0.11% | -0.00% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
