-
Policy
Policy
Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
LATEST FROM POLICY: -
EM Policy
EM Policy
Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
LATEST FROM EM POLICY: -
G10 Markets
G10 Markets
Real-time insight on key fixed income and fx markets.
Launch MNI PodcastsFixed IncomeFI Markets AnalysisCentral Bank PreviewsFI PiFixed Income Technical AnalysisUS$ Credit Supply PipelineGilt Week AheadGlobal IssuanceEurozoneUKUSDeep DiveGlobal Issuance CalendarsEZ/UK Bond Auction CalendarEZ/UK T-bill Auction CalendarUS Treasury Auction CalendarPolitical RiskMNI Political Risk AnalysisMNI Political Risk - US Daily BriefMNI Political Risk - The week AheadElection Previews -
Emerging Markets
Emerging Markets
Real-time insight of emerging markets in CEMEA, Asia and LatAm region
-
Commodities
-
Credit
Credit
Real time insight of credit markets
-
Data
-
Global Macro
Global Macro
Actionable insight on monetary policy, balance sheet and inflation with focus on global issuance. Analysis on key political risk impacting the global markets.
Global MacroDM Central Bank PreviewsDM Central Bank ReviewsEM Central Bank PreviewsEM Central Bank ReviewsBalance Sheet AnalysisData AnalysisEurozone DataUK DataUS DataAPAC DataInflation InsightEmployment InsightGlobal IssuanceEurozoneUKUSDeep DiveGlobal Issuance Calendars EZ/UK Bond Auction Calendar EZ/UK T-bill Auction Calendar US Treasury Auction Calendar Global Macro Weekly -
About Us
To read the full story
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Real-time Actionable Insight
Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.
Free AccessMNI POLITICAL RISK - Trump Announces Raft Of Key Nominations
BRIEF: EU-Mercosur Deal In Final Negotiations - EC
MNI BRIEF: Limited Economic Impact Of French Crisis - EC
MNI US MARKETS ANALYSIS - Ouster of Barnier Leaves Little Dent
MNI REVIEW: BOJ Tweaks Guidance To Help Hit 2% Price Target
By Hiroshi Inoue
TOKYO (MNI) - The Bank of Japan moved to strengthen forward guidance for
policy rates, extending the minimum time frame that 'extremely low' rates will
remain in place, as the side effects are seen as lower than other options
including deepening negative interest rates.
Thursday's decision also reflects that the BOJ is getting near the limit of
its current effective tools. They could deepen the negative interest rate from
-0.1% and increase the scale of its purchases of Japanese government bonds, but
there would be greater costs, with increased accumulated side effects from the
easy policy.
The BOJ kept monetary policy unchanged Thursday, as Japan's economy is
still "expanding moderately" despite persisting downside risks to both activity
and prices.
The BOJ board also decided to expand the eligible collateral for the
provision of credit, taking account of financial institutions that are having
difficulty of gathering JGBs following the Bank's bond buying program.
Strengthening the forward guidance also reflects that the officials in
charge of monetary policy are taking account of Deputy Governor Masazumi
Wakatabe who has said that the BOJ should boost easy policy if the momentum
toward the 2% price target is weakening.
--SEE NO INFLATION PICK-UP
The board's median forecast for inflation rate in fiscal 2021 ending on
March 31, 2022, -- the first release -- is +1.6%, indicating that the 2% price
stability target will not be achieved in a projection period -- prompting the
BOJ to tweak its forward guidance.
The BOJ board has also said their aim is to achieve the 2% price target at
the possible earliest time.
Whilst keeping the view that "inflation expectations have been more or less
unchanged", the BOJ board added that "momentum toward achieving the 2% price
target is maintained but it is not yet sufficiently firm."
--GUIDANCE
The BOJ tweaked its forward guidance for policy rates, saying, "the BOJ
intends to maintain the current extremely low levels of short- and long-term
interest rates for an extended period of time, at least through around spring
2020, taking into account uncertainties regarding economic activity and prices
including developments in overseas economies and the effects of the scheduled
consumption tax hike."
It will also relax the terms and conditions for the Securities Lending
Facility (SLF), including reducing the minimum fee rate and abolishing the upper
limit on the amount of sales per issue.
--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com
--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com
[TOPICS: MAJDS$,MMJBJ$,M$A$$$,M$J$$$,MT$$$$,MX$$$$]
To read the full story
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.