Here it comes folks!

  • will continue efforts to curb JGB volatility
  • BOJ is prepared to be more flexible with martket operations in response to a rise in yields
  • far too early to debate an exit from monetary easing
  • BOJ has decided no new tools are necessary now as market has stabilised ( oh really? )

USDJPY dips below 98.00 from 98.30.. currently 97.95

  • downside pressure on long-term rates will strengthen as BOJ bond buying continues
  • there is a strong incentive for banks to use BOJ’s scheme to support lending
  • BOJ’s year end forecast of its j-reit holdings not necessarily a ceiling for purchases
  • would consider extending fixed rate ops in the future if needed. BOJ debated on this but deemed it not necessary at the moment
  • do not seem much room to sharply boost buying of j-reits in the short term
  • BOJ’s large JGB buying will lower risk premium and become more effective over time

Keep up at the back ! USDJPY 98.12

  • stock price falls may affect consumer sentiment but trend is more important than short-term moves
  • steady improvement in jobs market likely to improve consumer sentiment
  • break-even inflation rates show signs of levelling off but other surveys show inflation expectations rising
  • BOJ hopes the govt will act quickly to implement growth strategy

That’s it! I’m off to dip my fingers in a bucket of ice cold water

USDJPY 98.17 EURJPY 130.26 GBPJPY 152.57 AUDJPY 91.79