IMF: BoJ's accommodative stance needs to be accompanied by bold structural reform, credible fiscal consolidation plan

Haresh Menghani FXStreet

According to a report published by the International Monetary Fund (IMF), BoJ's continued accommodative policy stance needs to be accompanied by bold structural reform, credible fiscal consolidation plan.

Additional headlines:

• Japan near-term fiscal stimulus should be neutral in 2018, avoiding scheduled withdrawal of fiscal stimulus
• The real exchange rate appreciated substantially 2015-16 to a level consistent with medium-term fundamentals
• Japan inflation likely to stay below 2% target over medium-term
• Japan economic growth momentum to continue in 2017, weaken in 2018 if fiscal stimulus fades - risks to economic outlook tilted to downside
• BoJ should carefully calibrate yield curve policy, if downside risks materialize, to provide additional easing
• Japan mid-term fiscal plan should place emphasis on gradual sales tax hikes, starting as soon as possible, to at least 15%
• Search for higher yields in Japan brings new and less understood risks

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

EUR/USD tests nine-day EMA support near 1.1850

EUR/USD inches lower during the Asian hours on Monday, trading around 1.1870 at the time of writing. The 14-day Relative Strength Index momentum indicator at 56 stays above the midline, confirming improving momentum. RSI has cooled from prior overbought readings but stabilizes above 50, suggesting dips could stay limited before buyers reassert control.

GBP/USD flat lines as traders await key UK macro data and FOMC minutes

The GBP/USD pair kicks off a new week on a subdued note and oscillates in a narrow range, just below mid-1.3600s, during the Asian session. Moreover, the mixed fundamental backdrop warrants some caution for aggressive traders as the market focus now shifts to this week's important releases from the UK and the US.

Gold buyers hesitate amid holiday-thinned trading

Gold trades volatile, but within range, as US, China holidays-led thin trading exaggerates moves. The US Dollar extends range play into the US GDP week, with markets pricing at least two Fed rate cuts this year. Technically, Gold tests key support at $5,000; daily RSI still remains bullish.

Top Crypto Losers: Dogecoin, Zcash, Bonk – Meme and Privacy coins under pressure

Meme coins such as Dogecoin and Bonk, alongside the privacy coin Zcash (ZEC), are leading the broader market losses over the last 24 hours. DOGE, ZEC, and BONK ended their three consecutive days of recovery with a sudden decline on Sunday, as crucial resistance levels capped the gains. Technically, the altcoins show downside risk, starting the week under pressure.

Global inflation watch: Signs of cooling services inflation

Realized inflation landed close to expectations in January, as negative base effects weighed on the annual rates. Remaining sticky inflation is largely explained by services, while tariff-driven goods inflation remains limited even in the US.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.